Abstract: Collateral as a significant form of atypical proprietary practice has evolved from a gray area in folk practice to a partially recognized form within academia of law and judicial practice. It has further been transformed into a guaranteed system confirmed through China’s national laws and relevant judicial interpretations. This process highlights important principles of socio-legal studies, indicating that economic and social development necessitates a flexible form of proprietary collateral which provides a substantive guarantee. This not only fosters the emergence of collateral practices but also propels reforms in China’s statutory law and juristic law.