The short answer? Yes. Macao is part of China. The full story is a little more complicated and nuanced.
Like Hong Kong across the water, Macao has its own money, passports and legal system that are completely separate from China. The city even has its own snazzy flag. Apart from in foreign affairs, Macao mostly operates as an independent city-state.
Until 1999, Macao was one of Portugal’s last surviving colonies. It was first settled as a colony in 1557 and primarily used as a trading post. It was from Macao that Portuguese priests made their first journeys into Asia to convert locals to Christianity. This 500-year history under Portuguese rule has left a heritage of Lisbon-inspired architecture and a distinct culture in the local Macanese.
The city was handed back to China in 1999 under the same ‘one country, two systems’ policy that saw Hong Kong gifted back to China in 1997. Under the agreement signed by Portugal and China, Macao is guaranteed its own monetary system, immigration controls, and legal system. The agreement also stipulates that China will not interfere in Macao’s way of life until 2049, which effectively means China won’t try and enforce communism instead of capitalism. Beijing remains responsible for foreign affairs and defense.
The city is administered as an SAR, or Special Administrative Region and has its own legislature, although the city does not enjoy full direct elections and has only limited democracy. In recent elections, only the candidate chosen by Beijing has stood for election, and has been elected unopposed. Unlike Hong Kong, there have been no large-scale demonstrations in favor of democratic reforms. What happens in Macao beyond 2049 is the subject of much discussion. The majority of the populace support remaining as a special administrative region, rather than joining China proper.
Key Facts About Macao's Autonomy
Macao’s legal tender is the Macanese Pataca, the Chinese Rembini is not accepted at shops in Macao. Most shops will accept the Hong Kong Dollar, and most casinos will only accept this rather than the Pataca.
Macao and China have a full international border. Chinese visas do not grant access to Macao nor vice versa and Chinese citizens need a visa to visit Macao. EU, Australian, American and Canadian citizens do not require a visa for short visits to Macao. You can obtain a visa upon arrival at Macao ferry ports.
Macao does not have embassies abroad but is represented within Chinese embassies. If you require a Macao visa, the Chinese embassy is the right place to start.
Macanese citizens are issued with their own passports, although they are also entitled to a full Chinese passport. Some citizens also have Portuguese citizenship.
Citizens of the People's Republic of China don't have the right to live and work in Macao. They have to apply for visas. There are limits in place on the number of Chinese citizens who can visit the city each year.
The official name of Macao is the Macau Special Administrative Region.
The official languages of Macao are Chinese (Cantonese) and Portuguese, not Mandarin. Most local Macao citizens don't speak Mandarin.
Macao and China have wholly separate legal systems. The Chinese police and Public Security Bureau have no jurisdiction in Macao.
The People's Liberation Army of China does have a small garrison in Macao.