The Treaty of Versailles signed in 1919 at the Paris Peace Conference, ended World War I. In Article 156 of the Treaty, Germany's colonies in Shangdong were ceded to Japan. Protesting this move, in an upsurge of nationalism, thousands of student-led demonstrators took to the streets of Beijing on May 4, 1919 to denounce Japan and foreign imperialism, starting the event known as the May Fourth Movement. Strikes and boycotts erupted across the country, and cut across class lines. The Beijing government withdrew its delegates from the Peace Conference. (The Treaty of Versailles was finally signed October 21, 1919.) The May Fourth Movement marked the high point of an intellectual revolution in China against oppressive domestic policies and cultural conservatism. In the Washington Naval Conference of 1921-2, the sovereignty of Shandong was restored, but Japan sill maintained its economic dominance over the railway and the province as a whole.

The May Fourth Movement took place just as the New Culture Movement (1917-1921) began to gain steam. This movement stressed Western ideas such as science and democracy, vernacular literature, education for girls, and emphasis on the future, and attacked traditional Confucian ideas and political conservatism.  The diplomat and scholar Hu Shih was a prominent figure in both the May Fourth Movement and the New Culture Movement. New writers of vernacular literature, such as Lu Xun, Lao She, and Mao Dun emerged. Leaders of the New Culture Movement believed that traditional Confucian values were responsible for the political weakness of the nation, and called for selective adoption of Western ideals of science and democracy in order to strengthen the new nation. 

Although the May Fourth Movement was highly influential, many of the intellectuals at the time opposed the anti-traditional message and many political figures ignored it. Chiang Kai-shek, as a nationalist and Confucianist was against the iconoclasm of the May Fourth Movement. As an anti-imperialist, he was skeptical of western ideas and literature. He and Sun Yatsen criticized the May Fourth intellectuals for corrupting morals of youth. When the KMT came to power under Chiang's rule, it carried out the opposite agenda. The New Life Movement promoted Confucianism and the KMT purged China's education system of western ideas, introducing Confucianism into the curriculum. Textbooks, exams, degrees and educational instructors were all controlled by the state, as were all universities.