Religion is permitted in China, but its practice is tightly regulated by the state. This paper uses individual‐level longitudinal data to investigate the association between religious regulation and religious outcomes in China. Measures of regulation are constructed from instances of state action against Christians as well as Christian perceptions of unfair treatment by the government. In summary, as regulation increases, an individual is less likely to identify with a religion and less likely to say that religion is important. For those individuals without religious identification in either wave, regulation is negatively associated with religious importance. Yet, for those individuals with identification in one or two waves, regulation is either unassociated or even positively associated with importance. These findings contribute to research on regulation of religion and religion in China. More broadly, they demonstrate the state can wield considerable power over people's private lives but also that this power has limits.