This research focuses on the modernization of Chinese People’s Liberation Army Navy (Hereafter, PLAN). The main feature of this research will be the qualitative and quantitative improvement of the PLAN equipment, focusing on an analysis of the PLAN’s C4ISR capability. The main purpose of this study is to evaluate the capability of PLAN by investigating the PLAN’s modernization and American views regarding to this topic. The second purpose of this study is to examine Japan’s policy options while analyzing the influence of PLAN’s modernization on East Asia and the alliance between Japan and the US. Concerning research methodology, not only open materials will be collected, but US military-related governmental bodies will also be contacted and individuals interviewed. This approach aims to investigate American policy makers’ current thinking, which is not clear in open references, and to reveal PLAN capability from an American viewpoint. With the marginalized position of military studies in Japanese society, Japanese media tends to project emotional arguments on China’s threat to Japan. Hence, this research can be thought to be significant due to my intention to produce a report that includes objective analysis based on military rationalism and realism. When the study’s contents are detailed with analysis in the media as well in the private sector, Japanese public understanding will be deepened and Japan’s policy-making process and Japan’s strategic thinking will be improved. A further possible side effect would be a deeper strategic dialogue with America and China.