BEIJING -- For more than a century after invading foreign armies burned down one of China's imperial palaces in 1900, Yuanmingyuan, its dilapidated grounds and necklace of lakes were largely neglected. Weeds and saplings sprouted among the ruins and along the rubbish-filled paths. Ponds and canals became mud holes.

Then someone tried to give the park a makeover.

Visiting this past spring, Chinese life-sciences professor Zhang Zhengchun saw workers covering the bottoms of the drained lakes with plastic sheeting, even as diggers uprooted huge boulders along their banks. The goal was to prevent water from leeching into the ground, sucked dry by the overuse of ground water by the people of Beijing. But Mr. Zhang fretted that the project would destroy the park's ecosystem and its traditional Chinese gardens.

He told a local reporter, who wrote a story and spawned a national obsession: determining what should be the park's new look. The issue has dominated headlines, it sparked a rare public hearing that was broadcast live, and generated tens of thousands of comments on Internet bulletin boards.

"In the last 10 to 20 years of economic reforms, pollution, environmental problems and the destruction of the ecosystem and cultural relics have been too widespread," Mr. Zhang says. "Yuanmingyuan is the last straw. To save a little water, they have totally destroyed an ancient landscape."

The hullabaloo underscores the concern among China's rising middle class over the toll that rapid economic change has taken on the country's environment and cultural heritage. Traditional architecture -- from courtyard houses in Beijing to the formerly ubiquitous canals in the eastern city of Suzhou -- has been pushed aside to make way for highways and high rises. Western aesthetics have, for many Chinese, become synonymous with prosperity.

In the race to rev up its economy, meanwhile, China has devastated much of its natural surroundings. Overgrazing and strip mining have encouraged an encroaching desert in the North. Automobiles and factory smokestacks belch pollutants that hang over cities in a gray haze. Industrial waste ejected into waterways has heavily polluted rivers and lakes.

The environment is one area in which the government has allowed limited activism. Nonprofit groups and protests are increasing in number. Even so, the government sometimes cracks down. In April, thousands of police and officials skirmished with farmers protesting a dozen polluting factories in the eastern town of Huaxi, causing 36 injuries, mostly among police, say local authorities. Half the plants have since been moved or shut down in response to the protests.

The battle over the plastic sheets has been the most high-profile environmental case to hit China in recent years -- tapping into public worries about the environment, anger at official corruption and rising pride in Chinese culture and heritage.

Built in 1709 for China's imperial family, Yuanmingyuan was designed as a sort of extravagant water park, situated over what used to be wetlands just north of Beijing. Man-made canals, lakes and ponds were interspersed among hills, gardens and palaces; fountains and statues spouted water. Imperial boating expeditions set off on the largest lake, named Fuhai, or "Sea of Fortune." Water comprised 40 percent of park's total area in its heyday.

Because Yuanmingyuan's lakes were built on wetlands, they were intended to have a self-sustaining ecosystem. The plentiful underground water helped keep the man-made ponds filled, and the rainwater that fell into the ponds helped replenish the underground water tables. Marine life -- and foliage near the banks of the ponds -- flourished, and birds and other wildlife were plentiful.

That ecosystem was disrupted in recent years as Beijing residents tapped into the underground water at a faster rate than rain could replenish it. The drier soil under and around the lakes soaked up water from the lakes at a faster rate, and the situation has been worsened by the recent years of drought.

Park management had to spend several hundred thousand dollars each year to buy water to maintain the original water levels of Fuhai and the other lakes.

Then, to slow the seepage, park officials last September drained all of the park's waterways and began covering the bottoms with plastic sheeting similar to that used to line landfill dumps. The waterways have yet to be replenished with water, leaving huge, dusty pits across the landscape where ponds and streams used to be.

That stirred up China's nascent environmental groups. After Li Hao, director of Beijing Earthview Environment Education and Research Center, heard about the park project from Mr. Zhang, the life-sciences professor and a friend, she alerted local reporters. She also wrote several articles herself arguing that the plastic lining would disrupt the natural exchange among water, soil and marine life, eventually turning the water into dead water and choking plant and animal life.

Yuanmingyuan officials' "whole goal isn't to preserve the water but to keep the level high enough to accommodate boats" so the park can make a profit renting them, sniffs Ms. Li.

Soon after news broke in the Chinese media, Internet bulletin boards buzzed with commentary on the issue. Many expressed outrage over the project, which they said would change the historic nature of the park.

Pedal-boat rentals account for a sizable chunk of the park's annual revenue, and environmentalists charged that lining the ponds with plastic was an easy way to raise water levels to allow more boating.

"They want to turn a heritage site into an amusement park," grumbles Yu Kongjian, a professor at prestigious Peking University who has written critical articles and runs a Web site partly dedicated to the issue.

Tan Xin, chief landscape designer for the renovation, dismisses criticism over Yuanmingyuan's new look. She says her team meticulously researched old Chinese paintings and read old poems so they could capture the original flavor of the park.

China's top environmental regulator, Pan Yue, smelled opportunity. Mr. Pan, a soldier-turned-bureaucrat, decided to make Yuanmingyuan a poster child for China's environmental woes. After ordering a halt to the park renovation pending further investigation, Mr. Pan, who is deputy head of the State Environmental Protection Administration, organized an unusual four-hour public hearing attended by more than a hundred experts, officials, ordinary citizens and reporters, and aired live on two Web sites.

The debate was "very impolite," says Ms. Li, who attended. "Both sides were very agitated."

Opponents said park officials failed to submit the required environmental-impact report to regulators, or to open the project to public bidding. When one speaker demanded the removal of officials who had signed off on the "illegal" project, park manager Li Jingqi stormed out of the hearing, trailed by television crews. Footage of Mr. Li getting into his chauffeured sedan played later on national TV, generating more than 1,000 Internet bulletin-board comments about his behavior. In a typical reaction, one writer criticized Mr. Li's "disgusting bureaucratic posing."

On July 7, Mr. Pan, the environmental regulator, ruled the plastic-lining project should be stopped for those lakes that haven't yet been covered and should be removed in some other lakes that already had been lined. He ruled the lining could remain in Fuhai, the biggest lake, where water seepage has been a major problem. Park officials say they will comply. They have plans to finish the work by Oct. 1.

Mr. Zhang, the professor, was jubilant upon hearing the outcome. "Before, many people worried more democracy and openness in China would lead to chaos. This case shows such worries are unwarranted," he says. "Environmental and cultural issues affect everyone's interests. Everyone has a responsibility to participate."