The post-1945 influx of Chinese immigrants from Mainland China put a strain on colonial Hong Kong’s limited housing stock and under-developed welfare and education systems. In response, the colonial government introduced a ‘Touch Base’ policy in 1974. Thereafter, all Chinese immigrants who failed to ‘touch base’, that is, reach urban areas of Hong Kong, faced repatriation. This article examines the origins and effects of the ‘Touch Base’ policy, focusing on how Sino-British relations and the anti-immigration discourse in Hong Kong affected policy-making, and vice versa. It argues that the policy change, a product of a new form of Sino-British diplomacy, was underpinned by popular hostility towards Chinese immigrants. The article further argues that this policy shift also reinforced the emergent differentiation between the Hong Kong Chinese and Mainland Chinese immigrants amongst the Hong Kong population. Hitherto, historians have explored the issue of post-1945 immigration using archival sources from the early Cold War period, but have not traced the origins of the anti-immigrant rhetoric that continues to be felt today.