Abstract: This paper describes an ancient Chinese language understanding system(ACLUS) in processing ten proverbial stories written in ancient Chinese. The system consists of a knowledge base and three subprograms. Theknowledge base includes two parts, one is a dictionary; the other consistsof a few sets of rules for processing sentences. The words in the dictio-nary are annotated with their lexical meanings and syntatic and semanticfeatures, and also with information on semantic match between some verbsand nouns. The syntatic analysis subsystem makes sentence parsing and providesspecial treatment of function words (FW), The translation subsystem trans-lates stories from ancient into modern Chinese, The question-and-answersubsystem behaves like a dialogue between teacher and student about themeanings of words and the meanings or grammatical construction of somesentences. The paper discusses the problems about case analysis, the tense of theverb and the addition or deletion of words in a sentence in ancient Chineseso as to facilitate interpretation and translation. The authors point outthat there is a remarkable difference between Chinese and Western langu-ages, and that the Chinese have their own way of understanding theirmother tongue. To identify the case of a noun or the tense of a verb, theChinese do not depend on the morphological signs of the word, but on abroad understanding of the context.

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