The existing research on the rural collective economic organization could be divided into two sections: one is about its historical transition as well as wins and losses in the period of Chinese Agriculture Collectivization. Another involves its transformation and improvements under the agricultural two-tier management system. In spite of the wealth of relevant research, some problems exist, such as lack of analysis from legal perspective, absence of clear definition and scrutiny on legal connotations, functional localization and legal formation of rural collective economic organization of the new period as a whole. In regard to these problems, we should strengthen the study in law field, and based on systematic review of the historical transition and legal system condition of the rural collective economic organization, focusing on the improvements of agricultural two-tier management system,propose a overarching reform scheme with systematical consideration on legal connotations, functional localization and legal formation of rural collective economic organization.