Basing on the data from the questionnaire survey, the article finds that the human capital of entrepreneurs played a fundamental role in the transformation and upgrading of NGEs.Furthermore, the factors, which have a significant effect on the transformation and upgrading of NGEs, include the status of the entrepreneur before starting the business, his original education background, his continuing education, and his aspiration and capacity to raise his human capital.The study also finds that viewing from the realty of China's NGEs development, the establishment of R&D department is rather certain desire or demand for, or result of transformation and upgrading, than the reason for it. <<