Forty km upstream from the city of Yichang is the massive Three Gorges hydro-electric project being built at Sandouping, one of the most famous man-made projects in history. Total length of the dam, upon completion, will be 2,309.47 metres, with a maximum height of 181 metres. Total storage capacity of the reservoir will be 39.3 billion cubic metres. It is being built in the effort to control floods, to improve shipping navigation and to generate power for a continued industrialization of China's interior provinces. Through power production alone this dam will generate enough electricity to replace 40 to 50 million tons of raw coal combustion each year.

There are three stages to the dam's construction. Phase I is a period of preparation and the first stage of construction, lasting five years, 1993 to 1997. Phase II is of six years, lasting 1998 to 2003. At the end of this phase, the power generators are put into operation. Phase III, another six years, 2004 to 2009, is the third and final phase of construction.

The middle of the dam is the spillway, some 483m in length. To the left and right of this spillway are two powerhouses. The left is 643.7m in length, with 14 sets of hyrdo-turbine generator units. The right is 584.2m in length, with 12 sets of hydro-turbine generator units.

Also being built, in addition to the dam, is a nearby shiplock / shiplift. There are two shiplocks being constructed, each with five compartments. Each chamber is 280m x 34m x 5m (length, width, minimum water depth), capable of passing 10,000 tons of barge fleet. The navigability of the upper Yangtze will be drastically improved by the widening of shipping lanes and the creation of a more constant water level within the new reservoir lake, eliminating strong river currents, dangerous sand bars and (partly) submerged rocks.