Abstract: In the Sanhua Town of Xishui County in Hubei Province, an improved gravity model was applied to analyzethe spatial interaction patterns of 43 administrative villages of the Sanhua Town, and quantitatively divided the town-and-village hierarchy in terms of the potential index and the vertex degree of the town-and-village network. In turn,the individual development strategies for the divided hierarchical components were proposed and discussed. Our resultsshowed that there were three significantly differentiated regions formed, i.e., the southwest region, the region along theS201 provincial highway and the east region. In the southwest region, the accessibility and comprehensive strength ofadministrative villages, overmatching the averages of township regions, were 19.39 min and 71.92, respectively. And, theirpotential index and vertex degree were mostly in Class I with a close village-to-village connection, acting as the center of the town-and-village network. For the administrative villages along the S201 provincial highway, a lower comprehensive strength (a score of 66.44) and a potential index (a level of Class II) were recorded. Whereas, because of their convenient transportation location, their accessibility reached 19.20 min, and their vertex degree was mostly in Class I, indicatingthat they enjoyed wide connections among villages. Since the east region presented a poor strength with a score of 54.06 and a backward transportation condition with accessibility of 27.23 min, most of villages in this region had their potential index and vertex degree in Class III. The loose village-to-village connection was found to marginalize the east region in the town-and-village network. Therefore, the town-and-village hierarchy of the Sanhua Town was divided into four levels according to the potential index and vertex degree and from the perspective of network structure and functional optimization: town/market town, key village, developing village, and ordinary village. Town and market town shall reinforce the rational distribution of industries and infrastructure construction, reflect the driving force of radiation and optimize the network connection of villages and towns. Key village shall plan the industry and agriculture reasonably, reinforce the spatial connections to economic centers like the town and market town, and promote the urban-rural integration development. Developing village shall consider its location and resource endowment, and determine the development directions accordingly. Ordinary village shall lay emphasis on the development of modern agriculture and promote the agricultural industrialization and scale development. This paper improved the theory of the town-and-village hierarchy system planning, may help to optimize the allocation of resources between urban and rural areas as well as to balance the urban and rural development.