Under the guiding principles of its nuclear policy—maintaining a minimum deterrent, asserting a no-first-use pledge, and avoiding a nuclear arms race—China is modernizing its nuclear forces to assure a limited, reliable, and effective counterattack capability that will deter a first nuclear strike. China’s nuclear modernization has been focusing on the quality rather than the quantity of its nuclear forces for the past three decades. There is no convincing evidence the country has expanded its arsenal significantly. Based on the Chinese government’s statements about its nuclear modernization efforts and available public information, the author estimates that China has a total inventory of approximately 170 nuclear warheads. This estimate is significantly lower than previous appraisals. China could well have the smallest arsenal of nuclear weapons among the five original nuclear weapons states. One factor that could cause China to increase the size of its nuclear arsenal is a US deployment of additional or more effective missile defenses.