Abstract: Nephrite's formation mechanisms are interesting issues for the gemmological research. Various researchers developed different categorization systems based on respective main causes of nephrite. However, the question whether nephrite within one main cause, can have different formation mechanism, is rarely studied. The answer to this question could directly change the understanding of how nephrite is formed in a geological process, and potentially have significant impact around how we can trace the ancient jades.Based on the observation in different nephrite jade mines, we believe that similar to how the jadeite categorized, we can divide each major type of nephrite into two subtypes, the R type (Replacement Type), formed by hydrothermal metamorphic replacement, and P type (Precipitated Type), formed by hydrothermal fluid precipitation, with distinct gemmological characteristics. P type can be further divided into 2 sub-types, Pt and Ps. Pt (Pp-Pressure & Torsional stress) is formed by construction environment with torsional stress, and mainly has fiber interweaving structure. Ps (Ps-stretching stress) is formed in construction environment with stretching stress, with typical comblike structure. Based on field study and market research, high quality jade is predominately Pt type.Within some mines with multiple periods of jade formation, some jades potentially simultaneously have both R and P types with complicated transitional relationship, but P type is usually formed later than R type.We believe the in-depth study of formation mechanism and geochemistry characteristics of R type and P type, is critical to explore how hydrothermal fluid links to some fundamental geological process in the formation and evolution process of nephrite mines.