This paper examines the relationship between the ultimate controllers’ separation of control right and cash flow right and capital structure using the data of 303 listed family firms covering the period from 2007-2009.We find that relative to the no-separate pyramid structures, the listed family businesses using the separated pyramid structures tend to choose higher capital structure; when the separation of control right and cash flow right covers the region of [10％-20％],the separation of the two rights is most negatively and significantly related to the capital structure, and between this region, the separation of the two rights is positively and significantly related to the rate of no-bank lending. This study makes implications for the deeply understand of the financing decisions of China’s privatized corporations controlled by the ultimate people, and makes reference for the supervise of financial institutions.