Using DEA?Tobit two?step method， we empirically study 2008—2011 all secondary and tertiary hospitals in City X， Guangdong and also analyse what has driven the differences in technical efficiency between private and public hospitals. We found that， ceteris paribus， private hospitals’ DEA score was 0.263 higher than that of public hospitals. It is due to the fact that compared to public hospitals， input like bed and construction area of private hospitals grew more slowly， but output like outpatient visits increased much faster. In addition， we found that quality of medicalcare and market competition help to enhance the technical efficiency of both private and public hospitals. But， drug share has a negative impact on hospital technical efficiency. We suggest that the government should promote the development of private hospitals，standardize and guide orderly competition in the marketand rigorously control drug share to improve the quality of medical care.