The rise of Wang Yangming School changed the severe rivalry between Confucianism, Daoism and Buddhism, which derived from the Song Neo-Confucianism rejecting the other two teachings as heresy. This change facilitated various discourses of "Three Teaching in One." The fundamental structure of these discourses, nonetheless, was relevant to the traditional philosophical category, i.e. substance-function theory, and whether they succeeded still needed to be studied. There was a breakthrough to the question that if there was new substance-function theory to illustrate the substance of the Way, Nature and Mind and to include discourses of all three teachings in the philosophy of two late Ming Caodong Chan masters Juelang Daosheng and Fang Yizhi. This paper studies the substance-function theory and the view of three teachings of two masters and makes four conclusions. First, when Juelang still held a traditional view of substance-function theory, Fang established a two-layer and three-stage theory, to which his ontological ideas "San Liang" and "Circle ∴" conformed. Second, Fang’s substance-function theory, far from a discourse of a quiescent ontological substance but of a dynamic transformation through which Being or Entity exhibits its own ontological characteristic, has a hermeneutical meaning. Third, Fang saw the coexistence of three teachings through this new perspective of Being, and at the same time developed his hermeneutics by exploiting the ontological meaning hidden in the intersection and circularity of three teachings. Fourth, this new ontology has the potential of being the theoretical foundation of his study of "material measuring" and therefore of all studies other than three teachings.
