Market-socialism represents a magic word of putting the two apparently contradictory terms together. The merging of a market mechanism with a socialist framework might require a certain degree of political compromises in order to achieve the expected harmonic result. However, in some special cases and under certain circumstances, market-socialism without political re-organization could produce satisfactory market reforms at the expense of short term fluctuation. This is the case of the re-adjustment of the urban spatial structure in China towards a market-based urban system. The choice of the leasehold land tenure system keeps the socialist doctrinaires comfortable while allowing a market mechanism to flourish. It is a pragmatic approach without political pressure for an overhaul social reform movement. In this paper, an examination of the rapid spatial re-structuring in Shanghai will be observed to illustrate that a sound economy is more important to rectify the socialist land use problem.