Xiao Hong was born on the day of the Dragon Boat Festival to a landowning family. Her mother died when she was young. In 1930 she ran away to Beijing to avoid a planned marriage, though was eventually followed by her fiance Wang Dianjia. In 1932, after she became pregnant her fiance abandoned her at a hotel in Harbin. She narrowly avoided being sold to a brothel by the hotel's owner by scraping together over six hundred yuan expenses.
Wretched, alone, and pregnant, Xiao Hong looked to the local newspaper publisher for help. The newspaper's editor, Xiao Jun saved Xiao Hong during a flood of the Songhua river. They began to live together, during which time Xiao Hong started writing.
In June 1934, Xiao Hong wrote a novel entitled The Field of Life and Death. The book was a gripping account of the tortured lives of several peasant women. In October, Xiao Hong moved to Shanghai’s French concession. With Lu Xun’s help, The Field of Life and Death was published in 1935, bringing Xiao Hong fame among Shanghai’s modernist literary circle. At the time, Lu Xun declared that Xiao Hong would one day surpass Ding Ling as China’s most celebrated female writer.
In January 1940, Xiao Hong moved to Hong Kong, and took residence in Tsim Sha Tsui in Kowloon. While in Hong Kong, Xiao Hong wrote her most successful novel, The River of Hulan, based on her childhood memories, along with a number of short stories based on her childhood, such as Spring in a Small Town.