Wuzhen developed on the dense canal network of the lower Yangtze delta between Hangzhou and Suzhou. Settlement in the region is ancient, while the town name is recorded by the late ninth century. Waterways carried people, rice, silk, timber, oil, and other goods more efficiently than roads across the low, wet landscape. Bridges joined neighborhoods on opposite banks, and buildings opened toward both canals and narrow lanes. Wuzhen’s form emerged through continuous commercial and domestic use rather than a single act of planning.

Under the Ming and Qing dynasties the town prospered through agriculture, textile production, dyeing, brewing, trade, and services for canal traffic. Merchants maintained shops and warehouses at the water’s edge, while workshops occupied houses where families combined residence and labor. Indigo-dyed blue cloth became one of the crafts associated with the district. Temples, guild facilities, schools, markets, stone bridges, and courtyard houses expressed local wealth and social organization, but fires, floods, rebuilding, and changing fortunes repeatedly altered individual structures.

Wuzhen also became associated with education and literature. Mao Dun, the pen name of Shen Dehong, was born there in 1896 and drew on the lower Yangtze social world in his career as a major modern Chinese novelist and cultural official. His former residence anchors one strand of local memory. Twentieth-century war, revolution, new transport, and industrialization weakened traditional canal commerce, while crowded housing and limited infrastructure challenged the preservation of old buildings. Wuzhen remained inhabited rather than becoming an abandoned historical shell.

Large-scale tourism redevelopment began in the late 1990s. The East Scenic Zone opened first, followed by the more extensive West Scenic Zone. Authorities and a tourism company restored façades, bridges, canals, workshops, and streets, relocated some residents, introduced accommodation and performance venues, and controlled entry. The result preserved a coherent water-town landscape and revived crafts for visitors, but it also changed property use, population, and everyday commerce. Some presented traditions are curated or reconstructed rather than uninterrupted survivals.

Wuzhen now combines protected architecture, operating canals, museums, guesthouses, shops, residences, and major events, including the World Internet Conference. Ticketed scenic zones frame the town as an emblem of Jiangnan culture. Its history should be read through both continuity and intervention: water shaped transport and building; households sustained trade and craft; modern writers turned the town into memory; and heritage development transformed an inhabited settlement into a managed destination. The restored beauty is genuine, but so are the social and commercial choices that produced it.