In the last three decades, states and societies have increasingly been connected to each other through Information and Communication Technologies (ICTs) such as satellites and the Internet, thus expanding the sphere of influence of cyberspace. While offering numerous economic and security benefits, this increased global connectivity also poses various security challenges and threats at the national and international level. In particular, the threat of cyberwar has become one of the top national security issues in both the United States and China, as reflected in an increasing number of cyber disputes between the two nations recently. In the wake of this emerging threat, scholars have turned to the classical deterrence strategies of Cold War to counter these new challenges, inspiring the development of cyber deterrence theory. However, numerous pundits in the cyber deterrence literature doubt the efficacy of cyber deterrence in hindering cyberwar. What theory or approach can offer the best explanatory framework for understanding the efficacy of cyber deterrence in forestalling cyberwar, specifically between the U.S. and China, is a question that remains unanswered. This study explores the effectiveness of cyber deterrence outside the bounds of classical deterrence and technological vulnerabilities in cyber systems and networks, and, then, offers Power Transition Theory (PTT) as an alternative approach to understanding whether cyber deterrence in the context of cyberwar between the rival antagonists can be successful. It answers the question of how PTT can allow us to better understand the effectiveness of cyber deterrence in preventing cyberwar between the United States and China. A cyber application of PTT argues that cyber deterrence is largely an ineffective approach to preventing potential cyberwar between the U.S. and China, particularly if the latter achieves parity in offensive cyberwar capability with the former while concurrently remaining dissatisfied with the status quo in cyberspace.