Following international trends to reform school management, the Chinese government has proposed school-based decision-making as a measure to raise the “quality” of education, but at the same time it has imposed new institutions of accountability for teachers and school administrators. In order to understand how this inter-play between accountability and discretion affects Chinese educational reforms, this paper analyses policy implementation through the lens of decision-making by principals and teachers as street-level bureaucrats. In the case of minority-language education in Xishuangbanna, a subject where institutions provide comparatively large spaces for discretionary decisions, I argue that the current institutions on accountability in minority-language education in China trigger processes by which implementers must interpret vague institutions in order to make decisions for their classroom. These purposefully wide spaces of “interpretational discretion” enable the party-state to make good on its promise to support local diversity, without threatening its own authority to prescribe educational goals.