Chi is used to overcome the 'hits' inflicted on your character by Threats (ie mooks) and Nemeses (ie boss monsters).<br/><br/>Threats inflict 1 hit per round.  Nemeses roll to inflict hits just like PCs do.  You can negate hits with either a Yin success or a point of Chi on a one for one basis.  So if you roll really poorly one round, you just cash in a point of Chi and keep on truckin'.  You aren't officially out of the action until you take a hit that you can't negate...not at Chi 0 but at Chi -1.  (And you aren't necessarily<em>dead</em>, either--you're just out of the fight.  You're lost or trapped, you passed out from shock, captured, et cetera)<br/><br/>The Rules Summary from page 25 of the Black Belt Edition has been added to the Reference and Cast thread.  :-)