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With the progress of information and communication technologies (ICT) and advent of the knowledge economy, the burgeoning e-commerce heralds new opportunities to reverse the declining trend of the rural economy. In the past two decades, the emergence of Taobao Villages in rural China has exemplified the significant outcomes of e-commerce in changing rural communities. Despite fruitful research on rural e-commerce, the formation mechanism of Taobao Villages has not been explained in detail. This study fills this gap by investigating the development progress of a typical Taobao Village in-depth. Drawing on the framework of neo-endogenous rural development, we conducted a case study in Dongfeng Village, one of the first three Taobao Villages in China, to identify the development path and formation mechanism of typical Taobao Villages. We found that the prosperity of e-commerce in Dongfeng Village …