The Constitution stipulates that the NPC is the highest organ of state power. It undertakes functions and exercises powers as follows.

The NPC has the power to amend the Constitution and a duty to supervise the enforcement of the Constitution. The Constitution is the basic law of China and as such carries overarching legal authority. Only the National People's Congress has the power to amend the Constitution. Amendments to the Constitution require a majority of not less than two-thirds of all the deputies elected to the NPC. No other state organ, political party or organization has this power.

The NPC has the power to enact and amend the law of the land. It is written into the Constitution that it is the National People's Congress that enacts and amends the basic law governing criminal offences, civil affairs, the organs of state and so on.

The NPC has the power to decide on the selection, appointment and the dismissal of those who carry responsibilities for the leadership of the organs of state. According to the Constitution and other laws, it is the National People's Congress that:

•  elects and dismisses the Chair, Vice Chair, Secretary-General and members of its own Standing Committee;
•  elects and dismisses the President and the Vice President of the country;
•  selects the Premier of the State Council, following nomination by the President;
•  also following nomination by the Premier, appoints the Vice Premiers, State Councilors, Ministers in charge of ministries or commissions, the Auditor-General and the Secretary-General of the State Council (and has the right to remove all of these from office);
•  elects and dismisses the Chair of the Central Military Commission;
•  appoints all other members of the Central Military Commission following nomination by the Chair of the Central Military Commission (and has the right to remove all of these from office);
•  elects and dismisses the President of the Supreme People's Court and the Procurator-General of the Supreme People's Procuratorate;
•  appoints and dismisses the Directors, Deputy Directors and members of the various special committees of the NPC.

 The NPC is charged with decision making responsibilities relating to the most important issues concerning the country including:

•  considering and approving National Plans for Economic and Social Development and reports on the implementation of that planning;
•  considering and approving the State Budget and implementation report;
•  approving the establishment of provinces, autonomous regions and those municipalities which come directly under the central government;
•  deciding on the establishment of Special Administrative Regions and their systems of governance;
•  deciding questions of war and peace;
•  making such other decisions as require authorization at the highest level.

The NPC has an overarching responsibility for the supervision of the organs of state. It represents the highest level of supervisory authority. It has a Standing Committee, which also carries constitutional responsibility.

State administrative, judicial and procuratorial organs are created by, are responsible to and are supervised by the NPC. The Chair of the Central Military Commission is responsible to the NPC and the Central Military Commission is subject to supervision by the NPC.

As set out in the Constitution and laws, the principal mechanism for supervision by the NPC is for it to receive and review reports from its own Standing Committee, the State Council, the Supreme People's Court and the Supreme People's Procuratorate. In addition, there are laws stipulating that when the NPC is in session, a group of more than 30 NPC deputies has the right to raise written questions on the work of the State Council and its ministries and commission, the Supreme People's Court and the Supreme People's Procuratorate.