Abstract: The rural industrialization in Jinjiang region, Fujian Province has promoted the rapid development of the local economy, which has also shaped the high-density, peri-urban built environment. This article takes the typical representative Chendai Town as an example to explain the development of small towns' built environment under the ‘Jinjiang Model’ from the perspective of industry-village collective-space interaction. At the beginning of the reform and opening up, the local social capital of Chendai Town promoted the bottom-up workshop industry, laid the development model with villagers and formed the spatial pattern of the integration of village-enterprise and household development model. From 1990 to 2010, under the pressure of external governmental control, the grassroots governance of the village community ensured that the village continued to serve as a platform for industrial development. The low-cost production space survived and the industrial clusters formed and continued to strengthen itself. From 2010 to the present, Chendai Town has entered the stage of industrial transformation. Decentralized autonomous development under the absence of planning and property rights has led to a decline in the quality of human settlements and the difficulty of redevelopment. As a result, the industrial structure is locked-up. The space has negative feedback to the village community and industry. This article also discusses how to achieve inclusive development through smart planning interventions in the development of rural industries.