As an island with a colonial urbanscape, Gulangyu (located off the coast of Xiamen, a city in Fujian Province in southern China) has been deteriorating into a touristic ‘thematic park’ since the last decade, resulting in a decrease of its original inhabitants and habitability conditions. Inspired by Italian lessons of various and evolved interpretations of the typo-morphological approach, this paper explores the possible interpretations and implications in Gulangyu in a two-pronged project: (1) by ‘systems’-four local characterized systems related to the specific physical urbanscape and matching practices of uses; and (2) by ‘parts’-four typical featured areas with respective typo-morphological features and facing crucial challenges. This provides a deep understanding of the island's situation and further develops and coordinates a specific framework of strategies for solving its distinctive problems. In particular, it helps in seeking to balance its preserved historic heritage, improvement of the local built-environment to meet contemporary needs and the development of a tourist economy - an urgent and salient task on the urban agendas of historic areas worldwide. As one of the first studies of the Italian typo-morphological approach in historic areas of China, this paper also demonstrates the notable possibility that such European, or more precisely, Italian ways may be practiced in the Chinese context, which may inspire further research and practices in China and beyond.