The theory of the relationship between literature and politics is an important issue in the literary theory with Chinese characteristics. Since the founding of the People’s Republic of China, the theory of the relationship between literature and politics has gone through a process of evolution from emphasizing the subordination of literature to insisting that literature alienates politics, and then to advocating the mutual infiltration of literature and politics. There are three reasons for this change: the transformation of Chinese contemporary social structure, the change of literary acceptance and creation practice, and the renewal of literary theory resources and research paradigm. The experience of the evolution of the theory of the relationship between literature and politics since the founding of the People’s Republic of China shows that the development of the theory of literature with Chinese characteristics should echo the transformation of social structure, absorb diversified theoretical resources, and conform to literary creation and acceptance practice. In the history of Chinese contemporary literary theory, the narrow-minded views on the relationship between politics and literature are mainly manifested in two aspects: subordinating literature to politics and separating literature from politics. The above-mentioned prejudice can be overcome by breaking away from the binary opposition between politics and literature and refreshing the understanding of the concept of “politics”.