When he was 11, his grandmother died and monks were invited to perform Buddhist rites. This was the first time he saw monks or sacred objects and it made him very happy. After this he read the sutras which deeply impressed him. When his uncle took him on pilgrimage to Nanyo, he became so attached to the holy place that he was reluctant to return home. When he was 14, his father discovered that he wanted to renounce the world and, in order to keep him, engaged a Taoist to teach him meditation. After practising Taoism for three years, he decided that its teaching failed to reach the ultimate goal. One day he fled to Nanyo but was soon found and brought home. Some time later his father sent for the two girls and celebrated Hsu Yun's marriage. Although the latter lived with his two wives, he had no intercourse with them but taught them the Dharma, which they understood.

At 19, together with his cousin Fu Kuo, he fled to Kushan monastery at Fuchow where his head was shaved, and here he followed the Master Miao Lien and received full ordination. After being ordained, his cousin left in search of enlightened masters but was never heard of again. Hearing that his father had sent servants to look for him, Hsu Yun hid in a grotto behind the monastery where he practised austerities for the next three years. At 25 he learned that his father had died in Hunan province and that his stepmother with his two wives had entered a nunnery.

During these years in the grotto, he made very good progress and had most interesting experiences. He says in his autobiography: "I was able to make my heart content and became free to go anywhere I wanted. As there were mountains to stay on and herbs to eat, I started wandering from place to place." At 31, he went to Wenchow where he met a monk who urged him to call on the old master Yung Ching who was well-versed in both teaching and Ch'an transmission. This master urged him to resume eating rice and to use the Kung An (koan) "Who is dragging this corpse of mine?" and ordered him to study the Ch'an rules, the Lotus teaching and other important sutras. From 36 to 43 he went on a pilgrimage to P'u T'o island off Ningpo, which was the bodhimandala of Avalokitesvara Bodhisattva, thence to the monastery of King Asoka at Ningpo and to many other holy places where he called on well-known masters and made good progress in his Ch'an practice.

At 43, he took stock of his achievements which were not complete and remembering how he had sacrificed his love for his parents in order to join the Sangha, he was ashamed that he had attained so little. In order to repay his debt of gratitude to them, he decided on a long pilgrimage from P'u T'o to the Five-Peaked Mountain (the bodhimandala of Manjusri) in the North-west to pray for their rebirth in the Pure Land. From the thatched temple of Fa Hua on P'u T'o island, he set out with incense sticks in his hands, prostrating himself every three paces until he reached his destination.

In his long walk with prostration at every third step and concentration on repeating Manjusri's name, he succeeded in realizing singleness of thought which was the key to his subsequent success in Ch'an training. Twice he was in danger of death and twice he was saved by Manjusri who appeared as a beggar called Wen Chi to hide his identity, instead of Wen Shu as he was called in China. The first time he had been caught in a heavy snowstorm and was very hungry, tired and exhausted for several days after which he was given some yellow rice gruel which brought him back to life. Later he caught malaria and dysentery and was dying in a deserted temple on the top of a mountain when the beggar appeared again to give him the hot water and medicine that saved him. Chi asked several questions which Hsu Yun did not understand and could not answer because he was still unenlightened and did not understand the living meaning of Ch'an dialogue (Japanese, mondo). Although he was told by the beggar that the latter was known in every monastery on the Five-Peaked Mountain, when he arrived there and asked the monks about Wen Chi no one knew him. Later he mentioned the incident to an elderly abbot who brought his palms together and said: "That beggar was the transformation body of Manjusri Bodhisattva." Only then did the master realize that he had actually met the Bodhisattva who had saved him twice on the long journey.