Chicago, one of the three largest cities in the U.S., has been a major manufacturing city in the Midwestern "Rusty Belt" since mid-1800s. As illustrated by the famous geographic historian William Cronon, Chicago is a "nature’s metropolis", and its growth is largely attributed to its unique geographic location. In its early stage of development throughout the 19th century up to the early 1900s, Chicago’s industries relied on its hinterland for lumber, grain and meat supplies and also provided the surrounding rural areas with agricultural machinery and other industrial goods. Its interdependence with the rural hinterland and its surrounding agricultural patterns can be explained by the von Thünen model. From the early 1900s to 1970s, Chicago gained significant growth in heavy industries (iron and steel, transportation equipment, chemical and construction materials, etc.). Its economic prosperity benefited from its proximity to the Great Lakes and access to Mississippi River (through Illinois River)for cheap waterway transportation as well as a radial railway network centered at Chicago. Weber’s industrial location theory, particularly the role of transportation cost, sheds light on understanding Chicago’s industrial development during this period. In the later 1900s, like many cities in the old "Rusty Belt" (from the Midwest to the Northeast)in the U.S., Chicago lost much of its manufacturing to the suburbia, to the south and even overseas. In addition to the drive for cheaper labor, more spacious land, easy access to interstate highways or better climate, non-traditional location factors particularly government policy and planning have played an important role. Chicago has minimized the impact of loss of manufacturing employment, to a large extent, by diversifying its economy. The purpose of this study is two-fold:to understand the history of Chicago’s manufacturing development in light of the classic location theories, and also in the hope, to learn some valuable lessons from Chicago’s experience and help us craft effective plans and policies in some old manufacturing regions in China.