Laogai, which means "reform through labor," is a slogan of the Chinese criminal justice system and has been used to refer to the use of prison labor and prison farms in the People's Republic of China (PRC).

It is estimated that in the last fifty years more than 50 million people have been sent to laogai camps. Laogai is distinguished from laojiao, or re-education through labor, which is an administrative detention for a person who is not a criminal but has committed minor offenses, and is intended to reform offenders into law-abiding citizens.

Persons detained under laojiao are detained in facilities which are separate from the general prison system of laogai. Both systems, however, involve penal labor.

In 1990 China abandoned the term laogai and started labelling the facilities as "prisons" instead.[why?]China's 1997 revised Criminal Procedure Law brought an end to official laogai policy, but some prisons in the Tibet Autonomous Region and in Qinghai still practice forced labor and amount to a continuation of laogai.

During the 1950s and 1960s, Chinese prisons, similar to organized factories, contained large numbers of people who were considered too critical of the government or "counter-revolutionary." However, many people arrested for political or religious reasons were released in the late 1970s at the start of the Deng Xiaoping reforms.

There are accusations that Chinese prisons produce products that are often sold in foreign countries, with the profits going to the PRC government. Products include everything from green tea to industrial engines to coal dug from mines. In addition to the fact that the same practice is found in Western countries (the making of license plates in the US for example), the products made in laogai camps make up only an insignificant amount of mainland China's export output and gross domestic product, according to researchers James D. Seymour and Richard Anderson.

It has been argued that the use of prison labor for manufacturing is not itself a violation of human rights and that most prisoners in Chinese prisons are there for what are generally regarded as crimes in the West. Western criticism of the laogai centers not only on the export of products made by forced labor, but also on the claims of detainees being held for political or religious violations, such as leadership of unregistered Chinese House Churches.

While the laogai has attracted widespread criticism for the poor conditions in the prisons, Seymour and Anderson claim that reports are exaggerated, stating that "even at its worst, the laogai is not, as some have claimed, 'the Chinese equivalent of the Soviet gulag.'"

The downfall of socialism has reduced revenue to local governments, increasing pressure for local governments to attempt to supplement their income using prison labor. At the same time, prisoners usually do not make a good workforce, and the products produced by prison labor in China are of extremely low quality and have become unsalable on the open market in competition with products made by non-imprisoned paid labor.

An insider's view from the '50s to the 1990s is detailed in the books of Harry Wu, including Troublemaker and Laogai. Wu spent nineteen years, from 1960 to 1979, as a prisoner in these camps for criticizing the government while he was a young college student. Almost starving to death, he eventually escaped to the US.

In Mao: The Unknown Story, Mao biographer Jung Chang and historian Jon Halliday estimate that perhaps 27 million people died in prisons and labor camps during Mao Tse-tung's rule. They claim that inmates were subjected to back-breaking labor in the most hostile wastelands, and that executions and suicides by any means (like diving into a wheat chopper) were commonplace.Jean-Louis Margolin writing in The Black Book of Communism, which describes the history of repressions by Communist states, claims that perhaps 20 million died in the prison system. Professor R.J. Rummel puts the number of forced labor "democides" at 15,720,000, excluding "all those collectivized, ill-fed and clothed peasants who would be worked to death in the fields."Harry Wu puts the death toll at 15 million.

Currently, the Laogai Research Foundation, a human rights NGO located in Washington, DC, estimates that there are approximately 1,045 laogai facilities in China, containing an estimated 6.8 million detainees, although the actual number of detainees is uncertain.