China has experienced incredible growth in the number of nongovernmental organizations (NGO) that occupy civil society. These organizations came forth at a time of rapid economic and political change. Instead of being given a supportive legal path for their work, NGOs have had to navigate the supply and demand factors in their specific situation in order to flourish. The demand side factors chiefly consist of matters pertaining to the need an NGO is meeting; and supply side factors pertain to an NGO's ability to create infrastructure to support their organization, including both the space in society to function and the processes necessary to fund their operation. By understanding the supply and demand side factors of the third sector, NGOs are able to achieve effectiveness in a variety of different capacities. In the current regulatory framework, many of these capacities are not entirely legal, but NGOs continue to find ways to make these arrangements work. Intermediary NGOs are a special type of NGO that positions itself to benefit both the donor and the beneficiary and help both overcome some of the challenges presented by the difficult regulatory environment. In doing this, intermediary NGOs fulfill a special role in meeting supply and demand in the third sector and can propose many useful solutions for philanthropy in China today.