The Institute of Chinese Studies was established in 1967 on the basis of a broad conception of Chinese studies. Its activities include what is traditionally identified as Sinology, but emphasize the application of scientific methodology, characterized by quantitative and comparative approaches, and the use of experimental methods where appropriate. Areas of studies related to contemporary Chinese culture and society have also been included amongst its activities.

The objectives of the institute are to promote Chinese studies by serving as an international centre for maintaining communication and cooperation with other academic and research institutions and scholars in this field; to provide local and visiting academic members of the University with funding and research facilities; to promote the exchange of knowledge and experience in Chinese studies through publications, conferences, and research seminars; and to foster the growth of modern Chinese culture.

Under the Institute of Chinese Studies are the Art Museum, the Centre for Chinese Archaeology and Art, The Ng Tor-tai Chinese Language Research Centre, the Research Centre for Translation, and the Research Centre for Contemporary Chinese Culture, each of which maintains its own academic programme and publication activities. The following periodicals are published by the Institute and its various units: Journal of Chinese Studies, Renditions, Studies in Chinese Linguistics, Newsletter of Chinese Language, Twenty-First Century, and Century China, a Web-based journal. A long-term project on constructing a comprehensive database of CHinese ANcient Texts (the CHANT Database) is also maintained by the institute. The reference reading room of the institute contains 34,500 volumes of books and 320 periodicals.