Using related research as a point of departure, this paper argues that current teaching and research in the Chinese EFL classroom is problematic on a number of accounts. Pedagogically, it tends to overlook, though often subconsciously, learners’ own language and culture in maintaining and constructing their bilingual identities in language learning. There is unrealistic aspiration on the part of EFL learners and their teachers to acquire a native-speaker English. In research practice, this misconception is also reflected in its focus on learner English or English in development measured by the yardstick of a native speaker English standard. A new framework has been proposed for teaching and researching English in China by drawing together key traditional Confucian principles and Western learning and language learning theories. Within such a framework, it is argued that a contextual localized approach would better facilitate the learning process, in which Chinese EFL learners may be able to develop a broad linguistic and cultural repertoire for optimal learning outcomes. More importantly, the new framework informed by Confucian principles aims to set realistic and achievable goals for both language learners and teachers, who may also need to see language learning and teaching as a process of developing and displaying unique bilingual and bi-cultural traits.