Abstract: The production capacity and distribution of CO₂ expanded tobacco (DIET) facilities in China were analyzed, the total cost of DIET, including processing, packing and transportation, was discussed in detail. The preferred temperature and humidity conditions while casing in storage were given, and the tobacco breakage associated with different packagings and vehicles was compared. The conclusions were:1) the establishment of DIET facilities should be centralized with larger scale, and the transportation radius should be within 600km in case of truck conveying; 2) for small-medium cigarette factories, it was cost-effective to buy expanded tobacco directly, so as to avoid capital investment; 3) it was suggested that DIET sold domestically should be packed with 665mm×370mm×700mm paper board cases, 5t vans could be used for short distance transportation, while trains should be chosen for long distance transportation; 4) it was suggested to set a professional packaging standard for DIET product.