We found nine nests of the Grey-hooded Parrotbill (Paradoxornis zappeyi) during April through July 2003 at Wawushan Natural Reserve, Sichuan, southwestern China. This report is the first description of the nest sites, nests, eggs, and breeding behavior of this parrotbill, and the first documentation of nestling growth from hatching until fledging. The nests were constructed mainly of bamboo (Bashania faberi) leaves, fibrous roots, and moss by both male and female. Nests were bowl shaped and in bamboo thickets 81–122 cm above ground, and 17–68 cm below the top of bamboo leaves. Clutch size was 3.1 eggs (n  =  8 nests) and eggs were oval, pale blue in color with a mean mass of 1.3 g. Incubation and provisioning of nestlings were by both parents. The nestling period was 13–14 days with a hatching rate of 0.52 and mean reproductive success rate of 0.48 fledglings per nest.