The periphery always occupies an important position in China’s foreign policy. However, the degree of criticalness and urgency of the peripheral diplomacy could vary depending on China’s perception of its peripheral environment: whether it is stable and benign or volatile and threatening. Decision-makers in Beijing make policy adjustments accordingly. Since 2010, China’s periphery environment has undergone significant geostrategic changes, particularly in East Asia. China’s perceptions of these changes naturally influence their foreign policy postures in the region. This chapter attempts to trace China’s evolving perspective of its peripheral environment, including its estimation and analysis of the nature of changes, the causes of changes, the implications for China’s interest and the possible ways to deal with the changing environment.