Moving beyond conventional accounts of gated communities typically devoted to issues on housing choices and urban segregation, this paper offers a nuanced perspective by demonstrating how the moral ordering of urban spaces is fundamental in shaping territoriality and exclusion in Shanghai's gated communities. Specifically, the paper argues how territoriality in Shanghai's gated communities is invariably bound up in a moral distinction between the 'urban(e)' and 'rural' that revolves around the moral discourses on civilised modernity. Such a moral order, as the paper contends, parallels the logic of hegemony such that class and social exclusion are refigured and depoliticised while the defence of luxury and privileges are simply recast as questions of differing civilised lifestyle and morality.