Mortgage-backed securities(MBS),originated in the U.S.and introduced into China in 2005,is a vehicle for real estate finance.This paper describes their history,mechanism,development,theory and experiences in the USA and other countries.In China,the real estate finance is partitioned into four stages: first,non-finance stage(1949-1977);second,sprouting stage(1978-1997);third,inceptive stage(1998-2004) and the fourth,developing stage(2005-),and it is distinguished from the finance of Real Estate Development firm.The differences between them are in following aspects: object,objective,mode and risk.This paper analyzes the institutional defects in view of the policy environment,the primary market of MBS,the secondary market of MBS,and offers countermeasures: first,setting up National Housing Mortgage Management Institution,second,enlarging the service scope of housing mortgage-backed loan,third,differential loaning,fourth,regularly issuing the pricing of housing construction;fifth,normalizing the institutional investors.