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Settlement relocation occurred repeatedly throughout global human history, often resulting in significant sociopolitical and economic changes. Historical records document the use of settlement relocation as a strategy for social engineering in China no later than the late Shang dynasty (1250–1046 b.c.). We employ placemaking theory to examine social changes associated with population movements to Taosi (2300–1900 b.c.) and Erlitou (1750–1520 b.c.) and the processes of urban construction concomitant to the movements at each site. Furthermore, we employ structuration theory to interpret the process of political knowledge building as concerns settlement relocation and social engineering. Based on our assessment of settlement histories, divisions of space, burial patterns, and community formation, we conclude that the use of settlement relocation as political strategy was formulated during the Taosi and Erlitou eras, and that it was intentionally implemented for political reform by Phase II of Erlitou.