Abstract:One of the conditions for breaking through the middle-technology trap is that there are some companies or institutions that could transform basic research into applied technologies. The progress of applied technology, as well as the inventions and new products and services produced by the applied technology system, play an important role in increasing productivity, improving quality of life, and promoting social and economic development. Different from the situation in basic scientific research, China’s applied technology used to be among the most advanced in the world in history. It was not until the Industrial Revolution in Europe in the 18th century that it began to lag behind the West. Since the founding of the PRC, China’s applied technology has made tremendous progress. Especially in the four decades since the reform and opening up, China’s applied technology system has developed rapidly. But compared with the most advanced level in the world, China’s applied technology system still has many aspects that need to be improved. This study argues that in order to further improve China’s applied technology, we should first have a deep understanding of the current situation of the system, then identify the problems and shortcomings that need to be resolved, and on this basis, propose improvement plans. Improving the applied technology system is a complex undertaking, subject to many factors. This study examines the shortcomings of China’s applied technology system and discusses how to improve them from the perspectives of scientific and technological population and tacit technological knowledge.