Abstract: Export limitation and total-amount control form the bulk of China's policies on its rare earth industry,but the prospect of the former one is dimed by the dispute panel reports issued by the World Trade Organization on China's rare earths exports.The aim of the article is to analyze the potential impacts on China's rare earth industry caused by the probable elimination of the export control measures and the policies that will be adopted thereafter.By applying empirical analysis,this paper assesses the effects of the two policies and finds out that the export limitation failed to achieve the expected goals,thus its elimination will have no serious negative impact.In the future the total-amount control policy will play the primary role,coupled with other measures including tax and fee adjustment,to achieve the goals of controlling the environmental impact of rare earths production,protecting the resources from exhaustion and keeping the price on a reasonable level.