In response to South Korea’s decision to station THAAD, the U.S. anti-ballistic missile defense system, in the wake of North Korea’s fourth nuclear test in early 2016, China began to take retaliatory actions, unilaterally destroying the friendly relations between China and South Korea. Since then, China has been put at risk of losing South Korea in strategic and economic aspects. If the Sino-Korean relations had been maintained at status quo at that time, it could have most likely served as a mechanism to break the strategic balance of power between China and the United States surrounding Northeast Asia, thus accelerating the power transition. This would have brought considerable strategic benefits to China. Furthermore, China’s economic retaliation will likely cause damage to its economy, given the high economic interdependence between the two countries. This being so, why has the Chinese leadership adopted a strategy of coercive diplomacy against South Korea? This paper has shed light on the motives of China’s offensive post-THAAD foreign policy towards South Korea, drawing on the above-mentioned problem awareness.