This paper puts forward “Ideas on Reforming City Gene” and “New Smooth City Mode”. At present, city suffers from fatal gene —“misplaced space”，which leads to ten serious problems hindering city sustainable development： occupation of too much city land, low efficiency, high energy consumption, heavy pollution, great difficulty in parking, poor public security, uncomfortable living environment, frequent occurrence of traffic accidents and huge amount of transportation investment. It is better to carry out study from perspective of 4 levels of “city transportation—city space—economy—society”，locate transportation problems from other point of view instead of from transportation, and get rid of gene of “misplaced space”. Only by this way, can many problems concerning city transportation and sustainable development get solved completely. A disordered city space can be separated into two free spaces by constructing one for cars and one for people respectively, thus constructing a “New Smooth City Mode”. The new mode can realize goal of finding new street system to adapt to characteristics of car transportation as put forward by “Athens Charter” as well as target of building saving and pleasant “human-oriented” city.