Abstract: The Chinese Metaphysical Institute has regarded the “Tathagatagarbha Sutras” as an independent branch, in order to highlight the purity of Vijbanavada. From the sight of this School, that the Madhyamika and Vijbanavada of Mahayana in Indian Buddhism have been reliable. But what they then spread to China—the thought of “the Innate Enlightenment”, was misinformed. So the Tiantai Sect, Huayan School and Zen Buddhism surely compounded the error. The reason why Taixu strongly advocated the theory of the “three classifications of Buddha’s teaching”, was to oppose the proposition of the Chinese Metaphysical Institute, and to set up alegalized reason for the thought of Tathagatagarbha to be inherited and developed in China. However, Yin Shun developed a new style that he approved the judgment of the “three classifications of Buddha’s teaching” of India. But he only accepted Madhyamika and was softly critical of Tathagatagarbha.In fact, Tathagatagarbha sutras or the thought of Tathagatagarbha cannot be seen as an independent system from Madhyamika and Vijbanavada. In order to defend for the deep impact of the thought of Tathagatagarbha on the inwardness ideology of Chinese Buddhism, people didn’t need to establish theories only from the perspective of the “three classifications of Buddha’s teaching”. Under the gradual maturity of Madhyamika, the thought of Tathagatagarbha appeared with the combination of the “original purity of mind” of Hinayana and the Buddha’s view of Mahayana. After the emergence of Vijbanavada, the thought of Tathagatagarbha was gradually absorbed by it, and then lost its independent status.