China's mixed ownership reform has sparked significant interest due to its influence on the expansion of state-owned enterprises. These enterprises, now emerging as global players, exhibit intricate expansion strategies shaped by the reform's dynamics. This research paper addresses the empirical puzzle surrounding the impact of mixed ownership reform on the expansion of Chinese state-owned enterprises, particularly those engaged in entrepreneurial activities. While prior studies predominately explore expansion within traditional manufacturing sectors, this study complements existing research and shed light on firm performance under reform influences.Framed within the context of entrepreneurship's role in industry innovation, this paper argues that mixed ownership reform stimulates entrepreneurial activities within state-owned enterprises. Specifically, the study's empirical findings provide insight into the positive influence of mixed ownership reform on state-owned enterprises' financial investment and R&D activities, promoting innovation and entrepreneurship. In addition, the research further uncovers that mixed ownership reform enhances TFP levels within state-owned enterprises. The analysis of mixed-ownership reform will aid policymakers in tailoring strategies for effective reform implementation, guiding policy considerations for future mixed ownership reform endeavors.