China has severely limited showings of Avatar in its cinemas. Only 3D showings of the film are permitted in China, and the country has very few theaters with the appropriate technology.
The ostensible reason for these restrictions is to make room for a patriotic biopic about the life of Confucius. However, there is speculation that the showings of Avatar have been limited because China’s government perceives subversive themes within James Cameron’s blockbuster.
Forced eviction in China is a daily reality, and perhaps the government is concerned that tenants may draw parallels between their own situations and that of the film’s extra-terrestrial protagonists, the Na’Vi.
The Chinese government’s suppression of Avatar is a symptom of a much larger issue in China. The nation is increasingly at odds with the West over its censorship policies, illustrated by their recent spat with Google. The search engine giant uncovered a sophisticated plot by Chinese hackers to access E-Mail accounts of their citizens.
In response, Google has announced its intention to cease operations in China. Secretary of State Hillary Clinton expressed solidarity with Google, and called on China to embrace a free and open Internet. The ruling party bristles when any attempt is made by outside nations to influence its internal policies, and every indication is that they will not be swayed.
China Is Like So Over The Avatar Hype

Damn them control freaks
people at Naviblue.com are talking about it.
This story is not correct for the date it was posted. There was news released a day previous that China is letting 2D screens show avatar once again and they are not going to regulate it any further. Source is below.
http://www.boxofficefollower.net/2010/01/avatar-2d-is-back-in-china.html
The reason for China’s limited screening of major Hollywood films is simply China’s response to Hollywood consistently snubbing its filmmaker’s for academy award nominations. Realize that Hollywood and Western media in general have its own agenda of smearing Chinese reputations. You never hear about all the support China is giving to Haiti in its time of crisis, instead its always something negative about the evil empire of China oppressing its people. Frankly I’m getting sick of it. There’s always 2 sides to every story don’t always believe what you read.
I fully agree with SimpleAM’s comments.
The western media is FULL of China-bashing. I happen to be have studied Chinese in University, and I could read the news from China. And I could see the obvious bias in reporting news by CNN, CBC and CTV in Canada. I don’t understand why, but it is clear to me that Americans don’t like anyone challenging its supremacy… Now USA can claim supremacy in owing the MOST to China. Good luck on that.