Welcome to ‘Dalifornia,’ an Oasis for China’s Drifters and Dreamers

To find the dance circle in the bed-and-breakfast’s courtyard, drive north from the bedsheet factory converted into a crafts market, toward the vegan canteen urging diners to “walk barefoot in the soil and bathe in the sunshine.” If you see the unmanned craft beer bar where customers pay on the honor system, you’ve gone too far.

Welcome to the Chinese mountain city of Dali, also sometimes known as Dalifornia, an oasis for China’s disaffected, drifting or just plain curious.

The city’s nickname is a homage to California, and the easy-living, tree-hugging, sun-soaked stereotypes it evokes. It is also a nod to the influx of tech employees who have flocked there since the rise of remote work during the pandemic, to code amid the picturesque surroundings, nestled between snow-capped, 10,000-foot peaks in southwest China, on the shores of glistening Erhai Lake.

The area has long been a hub for backpackers and artists, who were lured by its cheap rents and idyllic old town, where ancient city gates and white-walled courtyard homes point to the history of the Bai ethnic minority, who have lived there for thousands of years.

But recently, Dali has filled with a different crop of wandering souls: young people from China’s megacities, fleeing the intense lifestyles that so many of them once aspired to. Worn out by the high cost of living, cutthroat competition, record youth unemployment and increasingly suffocating political environment, they have turned Dali into China’s destination of the moment.

“Young people who can’t fit into the mainstream can only look for a city on the margins,” said Zhou Xiaoming, 28, who moved from Shanghai three years ago.

Mr. Zhou, always a free spirit, had worked in Shanghai as a teacher at an alternative school. But he found life there too expensive and wanted to explore even more non-mainstream teaching methods. Dali had many to sample — an experimental kindergarten that taught students to hike, another focused on crafts, and many home-schoolers. Mr. Zhou now privately teaches one student, in a village nestled between tea fields on the outskirts of town.

“Dali is remote and pretty tolerant and very fluid, and it has all kinds of people. And most of those people are weird,” Mr. Zhou said.

Depending on your point of view, Dali, population 560,000, can feel like paradise or a parody.

On a recent Wednesday, a Chinese fire dancer gyrated to the drone of a didgeridoo, an Indigenous Australian instrument, in the courtyard of an Israeli musician’s home. A few miles away, throngs of young people lining the streets of the old town peddled cheap fortunetelling, as pulsing music poured out of nearby bars. At a 24-hour bookstore, a reading group scattered on floor cushions discussed Shen Congwen, a prominent 20th-century writer.

A seemingly inescapable buzzword in Dali is healing. Healing yoga, healing camping trips, even healing coffee shops. At a co-working space on a recent Tuesday, about two dozen people listened to a presentation on combating loneliness. At the bed-and-breakfast’s dance circle, participants were encouraged to rediscover their inner child.

The therapeutic atmosphere was especially thick at Veggie Ark, a sprawling complex north of the old town that houses the vegan canteen, yoga studios, gong lessons and a dye workshop. Eventually, it would also include a “self-sufficiency lab” that Tang Guanhua, 34, was building in the courtyard: a wooden dome, constructed by hand, that when completed would be powered by solar energy, and serve as an exhibition space for handicrafts made with local materials.

Mr. Tang wanted the lab to encourage visitors to try out more sustainable lifestyles. When he had pioneered back-to-nature living in China more than a decade ago, brewing homemade vinegar and generating his own electricity, many considered him strange. Now, eight people had paid to participate in building the dome.

“Before, everything was fine, everyone went to work. Now, so many things aren’t right,” he said over a dinner of vegan hot pot. “People are thinking about what to do with themselves.”

Some of the new arrivals say they want to stay forever; others acknowledge they are looking just to try on an alternative lifestyle before returning to the city grind.

Still, even the most cynical observer would admit that the city feels tangibly more open and relaxed than most other places in China.

“People here won’t deliberately try to assign you labels. You can just be yourself and be seen,” said Joey Chen, a 22-year-old freelance writer who had dropped out of college and moved to Dali a month earlier from Jiangxi Province.

Ms. Chen was lounging in the attic reading nook of a bookstore, perusing the Simone de Beauvoir novel “All Men Are Mortal.” Downstairs, the walls were decorated with photos of Kafka and Che Guevara.

The openness extends to potentially sensitive topics, too. At another coffee shop, a rainbow flag was tucked into the rafters. A different bookstore offered volumes on religious topics, such as American Indian shamanism, Christianity and the history of Tibet.

The question is how long Dali can remain such a haven.

Tourists and influencers have flocked to Dali, wielding selfie sticks and posing in hot pink cars that businesses rent out for photo shoots. Throughout the old town, kitschy souvenir shops have replaced handicraft stalls and bookstores. The lakeshore teems with slickly designed bed-and-breakfasts that wouldn’t be out of place in Shanghai or Beijing, often run by moneyed arrivals from those very places.

Rents have soared, driving longtime residents out of the old town, toward more remote villages.

And nowhere in China is truly immune to the tightening political climate — as Lucia Zhao, the owner of the bookstore where Ms. Chen was reading Beauvoir, recently learned.

Ms. Zhao, 33, moved to Dali from Chengdu in 2022 after being laid off from a tech company. She opened her bookstore, which focuses on art, feminism and philosophy, because she wanted to create a space where people could relearn to think critically, she said.

But in August, officials suddenly confiscated all her books, on the grounds that Ms. Zhao had applied for only a regular business license, not a license specifically for selling publications. She shut down for several months while applying for the license and rebuilding her inventory.

She was now more cautious in her book selection. Local officials dropped in occasionally to inspect the store and had recently scrutinized a display of antiwar books she had put out.

“You definitely have more latitude in Dali than in cities like Beijing and Chengdu,” Ms. Zhao said. “But compared to when I got here last year, the space is shrinking.”

Still, for many people in Dali, politics seems to be one of the last things on their mind. And that may be less out of fear than the fact that they came to Dali precisely to avoid those kinds of worldly headaches.

In the kitchen of a co-living space popular with coders and entrepreneurs, Li Bo, a 30-year-old programmer, recalled his own experience with the limits of Dali’s tolerance. He had moved to Dali in October after growing tired of his office job in Beijing and quickly befriended the other residents at the youth space. By day, they worked together on the rooftop patio; at night, they barhopped, laptops in tow.

Not long after arriving, on Halloween, he had dressed up as a Covid testing worker, the hazmat-suited figures who came to symbolize China’s three years of stringent restrictions. It was a lark, he insisted, not political, but he was detained briefly by the police.

But amid the bonfire parties, hikes and open mics the town had to offer, Mr. Li had better things to do than dwell on the negative. Like his latest project: developing an A.I. fortunetelling bot, which he planned to offer to fellow bargoers the next night for 70 cents per reading.

Li You and Siyi Zhao contributed research.