Although the Chan masters did not encourage preoccupation with scriptural studies, they encouraged the initiates to study the basic Chan scriptures like the  Lankavatarasutra,  the Vimalakritinirdesa,  the Vajracchedika Sutras and some additional Chan texts as a a part of their preparation for the subsequent stages of observing into the nature of things. By denigrating the scriptural knowledge, the Chan masters therefore were not promoting illiteracy, but were preparing the students to free themselves from opinionated intellectuality and scholarly affectations to emerge into a world of notionless observations.

The word 'chan' is a corrupt form of the Sanskrit word, 'dhyana' meaning concentrated meditation or contemplation. Dhyana was an essential aspect of Chan Buddhism aimed to develop inner stillness and accumulation of chi energy among the practitioners. But what Chan encouraged, more than the mechanical aspects of meditation, was the development of an unfettered and detached mind, that would not cling to anything and would not rest anywhere and would flow with the flow of life, gathering nothing and gaining nothing. Chan Buddhism did not place too much emphasis on meditation, unlike the Zen Buddhism of Japan, but on finding the Buddha mind in the most mundane tasks and conversations of day to day life. In short, Chan made living a deeply religious act aimed to break the encrusted layers of thought.

Chan Buddhism underwent a schism during the 7th century resulting in the formation of two rival school, a southern school led by Hui-neng and a northern school led by Shenhsiu. While the northern school disappeared over a period of time, the Southern school underwent further sub-divisions resulting in the formation of five Houses and seven sub sects of which two survived. One was Lin-chi (Jap. Rinzai) and Tsao-tung(Jap.Soto).

Chan Buddhism influenced Chinese way of life profoundly. The Chan art became famous in ancient China for its spontaneity and simplicity of expression. But with the decline of Buddhism in China, Chan also gradually retreated into remote monasteries and gradually lost its appeal.