Shortage of water is the key limiting factor for agricul-tural development of Beijing. Rainwater harvesting (RWH) could provide an alternative water source for greenhouse agriculture, but local natural and socioeconomic conditions challenge the applica-tion of the technology. This article analyses the advantages and disadvantages of different types of greenhouse RWH in Beijing,and describes a new greenhouse RWH system demonstrated in 2008 in Huairou, a suburb district of Beijing. It analyses the ef-ficiency, cost-benefit ratios and limiting factors of the new system.The results show that with the new system, RWH efficiency can be as high as 66% (of total rainfall) and the rainwater usage rate can reach 69% of total water usage. The ratio of benefit to cost of government investment can be 1.84, and the ratio of benefit to cost of a farmers investment could be 1.68 provided the project is designed to save water and also increase income. However, the price of groundwater for agriculture directly influences the potential for applying and scaling up the project. If the RWH system does not increase the farmers incomes at the current water price, they will not use it until the water price rises to a critical point, which is de-termined by external factors. This article also suggests a number of measures to increase the efficiency of the system in order to apply it on a large scale.