Abstract: Based on the analysis on the problems of the rural collective construction land transfer, this paper find the rural land property institution, land acquisition institution, land market institution, are difficult to adapt to the request of collective construction land transfer management, the dislocation of government management and the lack of management system is the main reasons of the questions of collective construction land transfer. Then we tendered two theoretical statement:one is market failure and government failure, the government failure is main. And the others is that the basic point of the institution reform is the introduction of market mechanism, and give full play to the role of market mechanism under the government regulation, the key is the government function transformation. At last, build a theoretical framework of institution reform based on system design and policy adjustment, some policy and suggestions are put forward,which include perfecting land property right system and market system, relaxing regulation, and innovating regulation.