In recent years, corporate social responsibility (CSR) becomes more and more popular not only in  academic world but also in practical world. Many transnational companies adopted CSR practices base on kinds of motivations. There is also a rising trend on CSR program among Chinese SME. Moreover we noticed that, despite the challenges and misunderstandings, some Chinese textile SME successfully created competitive advantage with strategic CSR. However, there are few previous researches try to study on Chinese company in field of strategic CSR, especially on Chinese SME. This research intends to discover how the competitive advantage was created by strategic CSR in Chinese textile SME and try to explain the process by the existing theories. A case study approach was adopted in the study. From the case study and interview results, we aim to explain the behaviours of case firm by existing theories and conclude a Chinese SME specific CSR strategy. In the end, differentiated corporate social strategy, special CSR concept and CSR communication were concluded as the key factors influencing the success in the Chinese textile SME.