Abstract: The “worldly Buddhism”, first promoted by Taixu and then developed by Yinshun and Zhao Puchu et al, has become the mainstream in Chinese Buddhism and been taken as a pattern accustomed to modern society. However, the current development of the worldly Buddhism has engendered various arguments and doubts centered on “secularization”. This is due to the fact that the word “secularization” itself has various interpretations, and different observers hold different stances and apply the word “secularization” in different contexts. In talking about the “secularization” of Chinese Buddhism, some observers are confined in the Chinese historical context of Chinese Buddhism with ignorance of the grand backdrop provided by theories of modernity; some believe in some Western religious sociology while neglect the difference between Chinese Buddhism and Western religions; others insist that secularization and religion are opposite to each other. Hence, it is conducive to the theoretical construction of the worldly Buddhism and the future development of Chinese Buddhism to clarify the conceptual history of the word “secularization” and its different contexts, and further to analyze and clear up the “secularization” issue in the development of the worldly Buddhism.