This article examines the urban development strategies and pro-growth politics in China from a local state leadership perspective, focusing on the power dynamics within the local state leadership under China’s fragmented authoritarian system. The state-leading group is an innovative governance technique intentionally designed to overcome the institutional flaws of ‘tiao-kuai segmentation’. It plays a critical role in fostering a common vision of ‘growth promotion’, aligning goals and unifying actions in the administrative system, broadening social consensus and promoting public–private partnerships. This study improves upon the understanding of the micro-mechanisms of state-led urban development within China’s fragmented authoritarian regime by exploring the heterogeneity of state actors as well as the agency of key local political actors (groups) in aligning goals and interests within and beyond the state and their political rationalities. By highlighting the conflicts and negotiations that exist within the state, the debate on state-led urban development and pro-growth politics is extended using China as an example.