Xining, the capital of Qinghai province, is an especially valuable location for observing the spread and influence of Standard Chinese, or Putonghua, for at least two reasons. First, the dialect’s history of contact with non-Sinitic languages, mostly Tibetan and Mongolic languages, created an older linguistic stratum that differs markedly from other Mandarin dialects, indeed with most all Chinese dialects, in clearly identifiable ways, so that comparisons between Standard Chinese and variations within the Xining dialect reflect unambiguous cases of standard cum dialect language contact. Second, the demographic history of the region, including large-scale migrations of Chinese-speaking people from other provinces, created a socio-cultural context in which the promotion of Standard Chinese would likely find fertile ground. This paper will show that the combination of these two factors has created a situation in which the old Xining dialect is rapidly disappearing. In its place is not Standard Chinese, per se, but an interdialect, a compromise variety stripped of the most obvious dialect features but clearly distinct from Standard Chinese. The differences will be shown to exist in the phonology, lexicon and syntax of the dialect and that the more highly educated members of the community are leading the changes toward the New Xining dialect. While Standard Chinese is shown to have been a powerful force in the creation the New Xining dialect, it has not completely replaced the local dialect.