The subject of this thesis is Yan Fu’s translation Yuanfu 原富 (The Origin of Wealth) of Adam Smith’s Wealth of Nations. Its purpose is to discover how Yan Fu introduced unfamiliar Western economic concepts into late Qing China. It is an attempt to show to what extent the Chinese language was able to absorb Western concepts and terminology, and how they were received in a society with a Confucian ideology in strong contradiction to essential economical Western concepts as those conceived in Wealth of Nations, such as ‘free competition’, ‘material gain’ and ‘self-interest’. Moreover, we will observe the degree of faithfulness of Yan Fu’s translation and which translation methods and terminology he utilized. By back-translating passages from the Yuanfu and comparing them with their equivalents in the Wealth of Nations, our findings indicate that Yan Fu’s translation methods are vague and lack precision, though Yan Fu has managed to preserve faithfulness to a certain degree when applying his own definition. However, despite the fact that he constantly pursues xin 信 ‘faithfulness’ in according with his own view, he refers to his translation as a “free translation”, not in accordance with the general definition of faithfulness. His translation in the end has too many distortions for the readers to understand the essential concepts of Adam Smith’s work. Additions, deletions and restructuring of the text, as well as his body of terminology and written style, all contribute to the incomprehensibility of Yuanfu. Regarding his written style, we find that the translation was not aimed at “school children”, as he says, but to a small literary and bureaucratic elite of late Qing China. However, scholars in late Qing, as well as in modern times, have expressed that there are serious challenges in understanding the Classical Chinese employed. Regarding terminology, his approach in coining terms is discussed, and further why the Japanese terms ultimately defeated Yan Fu’s. With the purpose of understanding the dynamics of Yan Fu’s work on the Wealth of Nations, I have compared the original version of Yuanfu, not to my knowledge employed as a source for a study of Yuanfu, with a version published in 1981, most often referred to by scholars.