The Chiang Kai-shek Dairy is an unexplored treasure for the research of Journalism history. From 1928 to 1949, the dairy recorded a lot of events, people and opinions about the Journalism. In August 1943, Chiang Kai-shek wrote in his diary that “propaganda is more important than military affairs”, which is quite different from the image of his militarists and politicians. This paper combs the operation and failure of the whole KMT propaganda system. Under many new pressures in China and overseas, the KMT propaganda was full of loopholes. The defeat of the war began from then on.