Despite being an authoritarian state, China has adopted a quasi-federalist system to combat climate change. This chapter first introduces the structures and operations of China’s quasi-federalist system. Vertically, there are five hierarchical levels of bureaucracy. Horizontally, there are party committee, government, and environmental and ecological agencies at each level. Power is dynamically distributed vertically and horizontally. This chapter elaborates on the five mechanisms embedded in the quasi-federalist system, namely a target-responsibility system, the inclusion of environmental performance in local officials’ promotion assessment, fiscal incentives, the central inspection system for ecological and environmental protection, and public participation. We then conduct a case analysis of the low-carbon pilot policy in China to explain how each mechanism functions at each stage of the policy process. It shows that China’s quasi-federalist system in climate governance features centralized decision-making, supervision, and evaluation, together with decentralized implementation. China’s environmental quasi-federalism has allowed local governments to experiment with diverse and innovative solutions to climate change, but it has also experienced some challenges as demonstrated in the fragmented patchwork of policies at local levels of government. Overall, China’s environmental quasi-federalism has been effective in climate governance even though it has some drawbacks.