Generative artificial intelligence (AI) is playing a growing role in the creation of short-form fiction in China, with a massive surge in micro-series being uploaded online. According to the National Radio and Television Administration (NRTA), over 430,000 micro-series were uploaded in the first eight months of 2026—thirteen times more than the total number from the entire previous year. More than 90% of these micro-dramas, which are typically short videos designed for mobile viewing, were created using AI technologies. Some productions use AI for specific tasks like writing or editing, while others are nearly entirely AI-generated. These micro-dramas have become extremely popular, reaching more than 800 million viewers in China, and the market for such content is estimated to have surpassed 100 billion yuan (around 15 billion U.S. dollars) in 2025. AI is now involved in nearly every stage of production, including scriptwriting, set design, animation, voice acting, and editing. This trend is moving beyond just ultra-short formats, as shown by "The Later Journey to the West," a 30-episode series produced entirely without live actors. Each episode is about 40 minutes long and was released on August 31 on Mango TV and Hunan Satellite TV. This series is a fictional sequel to the classic Ming dynasty novel Journey to the West, set around a thousand years after the original story. The production is testing a new model where episodes are created, reviewed, and broadcast simultaneously, allowing the content to evolve based on feedback from regulators and the public. Despite the rapid growth of AI-generated content, the long-term financial viability of such productions remains unclear. While AI can significantly cut production costs and time, it is still uncertain whether these series will be profitable. The 15th Five-Year Plan (2026–2030) classifies micro-dramas as part of China’s new cultural industries and encourages their development. Regulators also aim to use AI to help Chinese content expand internationally, as Chinese micro-dramas are already present in over 200 countries and regions and make up more than 80% of the global market for such content. However, Chinese authorities stress the importance of traditional filmmaking with real actors. Wang Xiaoliang, a senior official at the NRTA, emphasized that productions featuring real actors should continue to form the foundation of high-quality content. To support this, authorities plan to encourage streaming platforms to create dedicated spaces for such content and offer financial incentives for quality productions. Regulatory efforts have also increased, with a new management framework for micro-dramas taking effect on September 1. This includes a system for labeling content and stricter checks on the use of faces and voices. Since the start of the year, 68,000 micro-dramas have been removed from platforms, and over 1,200 accounts have been asked to take corrective action. China’s overall strategy seems to be to advance AI-assisted media production while ensuring traditional filming remains a viable and respected part of the industry.