Previous studies on INGOs in China mainly focus on the organizational strategies for negotiating legitimacy with local governments. However, INGOs not only negotiate for legitimacy but also give an impetus to a clearly articulated mechanism for local governments to implement regulation and institutional improvement. Based on two field studies conducted from 2015 to 2019, this study reveals INGOs are willing to comply with regulation and urge their Chinese partners to do so. China's fragmented governance institution increases the difficulties in complying with the regulation. It's worth noting that, public security organs, which have long been perceived as a political gatekeeper, increasingly play a larger role of coordinator and facilitator for a smooth implementation of the INGO regulation. Yet pragmatism remains the underlying political logic of regulation and implies an unequal power relationship between the state and INGOs. These findings enrich the understanding of complex interactions between the state and INGOs under the new regulatory framework in China.