||Unlike previous studies which used income as the main indicator to examine the changing mechanisms brought about by the institutional transformations, housing attainment has been chosen in this paper to test the market transition theory and to examine the changing stratification mechanisms. By analyzing the changing role of state work units in housing provision, we combine the macro changes in housing reform policies and individual characteristics of workers to evaluate how work units’ role in different periods, consciously or unconsciously, influenced the housing attainment inequalities among workers in different sectors. A typology of workers, based on their status as a result of transferring between state sector and market sector, has been developed to examine how the sector locations influence the housing attainment of the four types of workers. Using China General Social Survey (CGSS) 2003, we test the effect of sector locations on one’s house quality as well as house ownership. Empirical results from OLS and binary logit models show that state sector employees benefited more from the housing reform than non-state sector employees in the period of 1978-1998 and their gained benefits have remained afterwards. The results imply that with work units present, market power cannot completely replace redistributive power in determining people’s social stratification in reform-era China.