This paper examines and evaluates livelihood capital and development capacity of families obeying the family planning policy in rural China employing a sustainable livelihood analytical framework. Comparisons are made between families obeying the family planning policy and those violating the policy，and families obeying the family planning policy are classified into different types according to their structure of children and development stages. Results show that child structure is affecting development capacity of rural families obeying the family planning policy，and they have less livelihood capitals when they are at stages of nurturing the young，owing income and supporting the old with relatively long period of inadequate development capacity. Development capacity is considerably challenged when the families enter into the stage of supporting the old with the lowest level of family livelihood.