Objective To provide evidence for the establishment of an essential medicines list, we investigated the institutional medicine supply in rural hospitals and community health service centers in Chengdu. Methods The trained investigators collected medicine sales records and information about the management of institutional pharmacies. Through in-depth interviews with the pharmaceutical personnel, we inquired into the drug supervision and supply networks in rural areas. Then we performed secondary research based on a comparative analysis of drug classification, administration and pharmacies in developed countries. Results Seven township hospitals/community health service centers had pharmacies, facilities, storage, and a clean environment. Three of them used electrical databases to manage medicine sales records. Five township hospitals and 5 village medical rooms purchased medicines from the drug supervision and supply networks every week. In this way, they ensured the quality and accessibility of drugs in rural areas. In the urban community health service centers, medicines were supplied based on the traditional commercial distribution system. Conclusion Rational allocation of health resources to set up institutional pharmacies and village medicine rooms is important. The supervision of village medical rooms must be stricter. We should expand the use of electrical databases and integrate the supervision and supply networks with the supply system of the essential medicines.