Who’s Afraid of Big, Bad Hollywood? Not China.

It’s well-known by now that China’s increasingly massive box office has become lucrative enough for Hollywood to sanitize its own films in order to reach the country’s viewers. Now it seems China’s notoriously lackluster domestic film industry is finally catching up to its Hollywood-fed audience. It just had its best month in history, with domestic films raking in the types of eye-popping sums previously reserved for Hollywood blockbusters. Two films, the live action/animation hybrid Monster Hunt and animated Monkey King: Hero Is Back, just smashed domestic box-office records. For many Chinese, it’s an achievement worth celebrating. “Monkey King has swept away the weakness shrouding Chinese animation,” one viewer wrote on Weibo, China’s Twitter-like social media platform. “I cried as I came out of the movie theater.”

In the past, many Chinese films have been so disappointing that netizens used the slang leiren — literally “to be struck by lightning” — to describe their ludicrous, far-fetched plots, poor acting, and low quality set and special effects. Even celebrity directors and movie stars often produce work that rank among the bottom five percent of all movies on Douban, which archives both Chinese and foreign titles. As a result, Hollywood has dominated China’s box office for years, despite strict government quotas on the number of foreign titles that can hit theaters annually — 34 annually, up from only 20 prior to 2012. In 2014, foreign films accounted for 61 percent of China’s box office revenue despite comprising only 11 percent of the number of total titles screened. Prior to July, the top five highest-grossing films ever released in China were all Hollywood fare.

But now, two films, Monster Hunt and Monkey King, have changed the game. In July, China’s box office earned $885 million in revenue, smashing China’s previous monthly record of $660 million. July also saw 23 consecutive days of box office revenues that passed the symbolic 100 million yuan mark, or about $16.9 million. Chinese films contributed over 95 percent of the month’s revenue. The success of July’s two tent-pole films suggests that Chinese domestic titles are catching up Hollywood’s in both substance and flash.

Monster Hunt (pictured above) is a fantasy directed by Raman Hui, a Hong Kong native who co-directed a Shrek sequel, depicting a young man’s kung fu-packed efforts to protect a radish-like monster son, to whom he accidentally gave birth. The movie, featuring a celebrity ensemble cast, broke records on its first day. It’s now the highest-grossing film ever made in China, with over $310 million in box office revenue as of Aug. 7. It also recently surpassed 2015’s Avengers: Age of Ultron to become the third highest-grossing film ever shown in China, behind only Hollywood sequels Fast and Furious 7 (2015) and Transformers 4 (2014).

Then there’s Monkey King: Hero Is Back, an animated film that offers a twist on the classic Chinese novel Journey to the West, which has grossed over $131 million to become the highest-grossing animated film ever released in China, dethroning Hollywood’s Kung Fu Panda 2, which took the country by storm in 2011. In a reimagination of the classic Chinese fantasy novel Journey to the West, the movie portrays a mythical monkey king who protects his young master on the way to a distant land to obtain sacred texts. Monkey King took a tortuous path to success, originally passed over by many movie theaters leery of domestic animation’s historically poor box office performance. It was, in part, an online social media rally for the film that ultimately quadrupled its share of screens in theaters and eventually made it China’s most successful animated film.

Aside from a social media boost, both movies also had plenty of government help. China’s film regulator, the State Administration for Press, Publication, Radio, Film, and Television, as an unofficial rule “discourages movie theaters from showing foreign films” from June 10 to July 10 each year, a period that some filmgoers have dubbed “Domestic Film Protection Month.” Both films hit theaters during that period.

But other figures suggest that the incredible July success is not incidental, but instead a clear sign of the Chinese film industry’s long–anticipated rise. One space to watch is animated films, a category into which both July hits wholly or partially fit. There is near universal agreement on the Chinese Internet that the technical competence of domestic animated films has improved drastically over the past few years. According to the state-owned magazine Northern Media Research, China’s animation industry, including television, film, books, and animation-related merchandise generated a projected $16 billion in revenue in 2014, which would represent a year-on-year growth of over 14 percent. The rate of revenue growth for animated films alone was even higher; they grossed over $483 million in box office revenue in 2014. Prospects for further growth remain high; Light Chaser Animation Studios, dubbed China’s answer to Pixar, raised $20 million in Series B funding in 2014.

For years, Chinese filmmakers could only dream of having what they call “‘super IPs,” denoting mega-franchises like Hollywood’s Star Wars that generate massive merchandising revenue in addition to box-office receipts. Monkey King appears to mark the first successful Chinese attempt to create a domestic franchise that meets the definition. Consumer products such as Money King T-shirts and toys grossed $1.8 million on Alibaba’s e-commerce platform on the first day of sales. The eponymous mobile game, made by China’s gaming giant Chukong Technologies, also debuted this month. Directors of both Monster Hunt and Monkey King said there would be sequels.

If Chinese domestic films are finally growing up, they’re doing so at a fortunate time. China’s box office still has tremendous room for growth: As of 2014, China’s number of movie screens per capita is only one seventh that of the United States, and box office per capita only one tenth. As long as the quality of Chinese films improves, Chinese moviegoers are more than happy to opt for domestic titles over their Hollywood competition. “I’ve been eating at my neighbor’s for nearly 20 years,” one social media user wrote of his viewing habits, which had favored Hollywood fare. “But today, I finally smelled real food in my own kitchen. Come on, dinner is ready. Let’s all go home and eat.”

Photo credit: Via Edko Films/Fair Use