By 1932 one of the Wan brothers, Wan Di-huan, voluntarily left the Great Wall Film company for his own photography studio. Some of the first wave of influential American animations that reached Shanghai were Popeye 大力水手, and a show known as 波比小姐 that may be an off translation to what is known today as Betty Boop.
By 1935 the Wan brothers launched the first animation with sound titled The Camel’s Dance. Four years later in 1939, America's Disney's Snow White would also be introduced in Shanghai and it would be a great influence. In 1941 China's first animated feature film of notable length, Princess Iron Fan, was released under very difficult conditions during Second Sino-Japanese War and World War II using extensive rotoscoping. While there were overlapping progress made in the Asian regions with Japanese anime at the time, they were not geographically or artistically influential to China directly.
During the Japanese invasion period, the brothers produced more than 20 animated propaganda shorts focusing on various patriotic topics from resistance against Japanese troops, opium and imperialism.
Steady development (1946-1949)
In October 1, 1946 a northeast motion picture studio was established in the Nenjiang province, known today as the Heilongjiang province. It is the first known studio established by a communist party. In 1947 productions such as Emperor's Dream used puppets in an exaggerated way to expose corruption of the Kuomintang Chinese nationalist party. The idea of using political content in puppetry films was becoming acceptable, and animators took note on their success. An example of such documentary-type cartoons can be found in Go after an Easy Prey (1948). In 1948 the Northeast studio would change its name to Shanghai Picture Studio Group. On October 1, 1949, China entered a new communist era led by Mao Zedong.