By the summer of 1950, the People's Liberation Army (PLA) had grown into a huge force of an estimated 5,238,000 men, organized into 253 divisions. However in reality, the actual military strength of the PLA was much lesser than what the paper figures suggested. This was due to equipment, organizational, training, leadership and logistics deficiencies etc. Only half of the 253 divisions could be considered as reasonably combat-effective. The numerous units also had varying origins. Some were composed of long-time Communist fighters against the KMT and the Japanese. The rest were former KMT units which had surrendered and were integrated into the PLA forces, either inidividually or wholly at the divisional level.

II: Overall Organization
The entire PLA was under the direction of the Central Military Commission, which was made up of senior members of the Communist Party. The PLA Army was broadly divided into 4 Field Armies, organized per below: -

Commander in Chief - General Zhu Deh
Acting Chief of Staff - General Nie Rongzhen
First Field Army - General Peng Dehuai - 34 divisions
Second Field Army - General Lin Po Cheng - 49 divisions
Third Field Army - General Chen Yi - 72 divisions
Fourth Field Army - General Lin Biao - 59 divisions

At the time of the N Korean invasion, the First Field Army was 'pacifying' the Xinjiang region and NW China; the Second Field Army was in W China, preparing to advance into Tibet; the Third Field Army was on the east China coast (around Shanghai), preparing to invade Taiwan while the Fourth Field Army was stationed along the S China coast, tasked with seizing Hainan island and rooting out the last remaining KMT forces in the south. The Third and Fourth Field Armies were also charged with coastal defence.

A Field Army could be broken down further into Army Groups, Armies, Divisions, in succession.

In late winter 1949, the PLA also formed a central reserve force by moving the 13th Army Group (consisting of 6 Divisions in the 38th and 39th Armies) from the Fourth Field Army to Zhengzhou in Henan province. In May 1950, the 40th Army (which was involved in taking Hainan island) was added.

III: Divisional Organization
The Chinese Division was pretty bare-boned, usually consisting of 3 infantry regiments of 3000 men each, an artillery battalion and miscellaneous other troops (which added up to about 10000 men nominally in each Division). Each infantry regiment in turn usually had three infantry battalions, plus (sometimes) an artillery company, a mortar company, a transportation company, a guard company, and a recon and signal unit. Each infantry battalion in turn had three rifle companies. Each rifle company in turn had three rifle platoons, a heavy-weapons platoon with 60mm mortars and rocket launchers, and three machine-gun squads.

The divisional setup could vary widely, depending on its origin, location and mission. Some divisions had more than 10000 men each, particularly those earmarked for the invasion of Taiwan. These included those in the 20th, 26th and 27th Armies in the 9th Army Group (which would be one of the 2 Army Groups sent to N Korea later on - the other being the 13th Army Group in the central reserve force).

Soviet advisors were also on hand in helping to reorganize the PLA (due to the mutual security pact signed in 1949), along Soviet lines.

IV: Equipment
In terms of equipment, the PLA was primitive, comparable with a WW1 army in 1914, minus the trucks and artillery. It was overwhelmingly an army of infantrymen. There were few trucks, little artillery, no air support, and no antiaircraft defense. The PLA had no armor forces.

Whatever equipment existed, varied greatly, ranging from US equipment captured from the KMT, to Japanese equipment captured during WW2 or turned over by the Soviets, to Czech equipment purchased on the open market. The Soviets had promised more modern equipment, but these had not arrived yet prior to Chinese entry into the Korean War. Some infantry regiments had as few as 400 rifles, 180 pistols and 200 submachine guns. Prisoners had reported that as many as two-thirds of frontline troops had no weopans, other than hand grenades (they were expected to pick up weapons from dead or wounded comrades, or from the enemy).

At the Divisional level, there might be 6 105mm howitzers or 76mm guns, 4-6 37mm antitank guns and 4 120mm mortars. At regimental level, there might be 3 75mm pack howitzers, 135 light machine guns, 18 heavy machine guns and 18 60mm mortars.

(But the divisions sent to N Korea left behind almost all artillery, as well as most of their heavy mortars).

Transportation for other crew-served weapons and ammo was via pack animals.

Communications were even more primitve. In some divisions, radio extended down to the regimental level. In all divisions, communication from the regiment downward was by telephone, or by runners. There was normally only one telephone at each battalion headquarters, and none below that. Bugles, whistles and runners were the means of communication between battalions and companies, and between companies.

V: Political Organization
One of Mao's tenets was that the Communist Party must contol the PLA. Absolute control was essential. Thus leadership within the PLA units was shared between the military commander and the political commissar. In many cases, the two were interchangeable i.e. the commander was politically dedicated to the Party, and the commissar was an experienced military man. In some cases, the two roles were even filled by the same person as in the case of General Song Shilun, who was both the military commander as well as the political commissar of the 9th Army Group.

Control of the PLA was through the means of Party committees, which extended down to company level. Within the company, the political organization extended down to the rifle squad, with a 'three by three' system within the squad. I.e. each man was assigned to watch the other two, and each was aware he was being watched.

Further control was ensured by having a reliable Party man in each unit down to the subsquad level. In addition, an extra-close watch was also maintained on the watchers.

VI: The Average Chinese Soldier
The bulk of Chinese soldiers were recruited from the rural peasantry. These were unimpressive-looking, short, scrawny, thin-legged men. But they were tough and accustomed to hardship, indifferent to discomfort, generally in good physical condition and (importantly) capable of sustained long marches. Most were poorly educated and often illiterate, but reasonably intelligent. And were very capable as night fighters.

There was officially no conscription, as each recruit was defined as a 'volunteer'. Each village would be given a quota, and this quota would usually be filled, with little need at 'persuasion'. This was because the Communists had brought much benefits and more importantly dignity to the poorer peasants, and preferential treatment was given to those families who had provided the 'volunteer'. The PLA was also well-liked because they ensured that the soldiers were kept well-fed - an important point in (formerly) war-torn China.

There was no fixed term of service. Discharge only came with illness or injury, or at the PLA's pleasure. There was little opportunity for leave. To further isolate the soldiers from the outside, only higher 'ranks' (colonels and above) were allowed to marry.

Because a large number of recruits were originally from the KMT armies, these posed particular problems for the PLA. At the unit level, these were integrated into the PLA organization, depending on the terms and conditions of their surrender (like how hard they had fought against the PLA). Individually, the ex-KMT soldiers would be indoctrinated, during a period lasting from 2 weeks to 3 months ('brainwashed', to use the Western term). Ex-KMT officers were treated more severely - dispensable ones were often shot outright. However the PLA needed junior officers - these were sent to the 'Military-Political University' and subjected to a more intense process of indoctrination.

(Of note here, between 50-70% of those troops sent to N Korea were ex-KMT).

VII: Discipline and Morale
Discipline in the PLA could be surmised in the following two slogans: -

The Three Imperatives
1) Obey orders in all your actions.
2) Don't take a needle or a piece of bread from the people.
3) Turn in everything you capture.

The Eight Points of Attention
1) Speak politely.
2) Pay fairly for what you buy.
3) Return everything you borrow.
4) Pay for any damage.
5) Don't strike the people.
6) Don't damage the crops.
7) Don't take liberties with women.
8) Don't mistreat captives.

From the above, it was easy to see why the PLA was popular with the Chinese people, compared to the earlier warlord and KMT armies (which were often little better than bandits).

Morale was the responsibility of political officers. To the furthest extent possible, they kept a close watch on the overall morale and ideological commitment of the unit. For monitoring, subsquad, squad and platoon leaders report twice weekly to the political officer. There was also a regimental political section to covertly watch the unit. This led to the result of disaffected individuals keeping very quiet, to avoid trouble.

VIII: Leadership
There were no ranks in the PLA except for 'soldier' and 'officer'; a leftover from the earlier days of being a voluntary guerilla army. Individuals were distinguished only by their position such as 'squad leader' or 'battalion commander'. Officers wore the same uniforms as the same rank and file; except maybe for an extra red piping in some cases.

There was a particular shortage of experienced junior officers in the PLA. To solve this problem, a large number of available ex-KMT officers was utilized, subject to close political supervision.

Also, leaders (particularly those at the lower levels) faced a peculiar problem unique to the PLA. Decisions in combat or whatelse not only must be tactically or militarily sound; they must also be politically and ideologically correct. This led to a serious hindrance on the exercise of intiative on the battlefield; a loss of many opportunities for exploitation.

IX: A Last Word
It was not the same army as the warlord armies or the KMT armies which had plagued China during the first half of the 20th century. Many Westerners (at the time) continued to evaluate it with the same disdain, as was meant for the aforementioned types. General MacArthur and the other American officers (generally) certainly shared the same sentiments, and not without basis. They would find out just how unusual this new Chinese army was, to their great cost later on.
This analysis was taken from here http://forums.civfanatics.com/showthread.php?t=104638