• The history of China’s municipal wastewater management is revisited. • The remaining challenges in wastewater sector in China are identified. • New concept municipal wastewater treatment plants are highlighted. • An integrated plant of energy, water and fertilizer recovery is envisaged. China has the world’s largest and still growing wastewater sector and water market, thus its future development will have profound influence on the world. The high-speed development of China’s wastewater sector over the past 40 years has forged its global leading treatment capacity and innovation ability. However, many problems were left behind, including underdeveloped sewers and sludge disposal facilities, low sustainability of the treatment processes, questionable wastewater treatment plant (WWTP) effluent discharge standards, and lacking global thinking on harmonious development between wastewater management, human society and the nature. Addressing these challenges calls for fundamental changes in target design, policy and technologies. In this mini-review, we revisit the development history of China’s municipal wastewater management and identify the remaining challenges. Also, we highlight the future needs of sustainable development and exploring China’s own wastewater management path, and outlook the future from several aspects including targets of wastewater management, policies and technologies, especially the new concept WWTP. Furthermore, we envisage the establishment of new-generation WWTPs with the vision of turning WWTP from a site of pollutant removal into a plant of energy, water and fertilizer recovery and an integrated part urban ecology in China.