The development of high-speed railway (HSR) new towns in China represents a new phase of suburbanization and has had a significant impact on urban expansion, but not all of its mechanisms and drivers have been studied. This article aims to understand the booming development of HSR new towns in China through the theoretical lens of state entrepreneurialism. It dissects the entrepreneurial behaviors of the local state in a medium-sized city, which harnesses the HSR project strategically to develop a new town. Our findings reveal that local governments play out state entrepreneurialism in developing HSR new towns. They compete with other cities for HSR projects. They are motivated by land revenue generation, career advancement for officials, and maintaining state power. Furthermore, this article contributes to the understanding of interactions among multi-level governments. Local states in China can also exert influence on the policymaking and resource allocation of the national government.