These are troubled times for Beijing's ancient hutong laneways, which once fanned out around the city to form a graceful network of passageways lined with traditional courtyard houses - grey, Ming-dynasty environs filled with atmosphere.

Only a third of the hutongs still exist; the rest have been demolished or partially destroyed, a survey shows. The devastation of ancient areas such as Qianmen, which used to house some of Beijing's oldest traditional courtyards and alleys, bears out the report's findings. The city has lost many lanes, some of them dating back to the 13th century, to make way for new developments.

As well as being the main form of urban construction in the "northern capital" of Beijing, the hutongs have for centuries provided a framework for vibrant local communities, as knife sharpeners, coal merchants and fruit sellers moved up and down their precincts plying their wares.

Hutong is originally a Mongolian expression meaning "well"; in early Beijing, communities grew up in the streets leading to the wells. During the early Ming dynasty (1368-1644), there were 458 hutongs in Beijing, rising to 978 during the Qing dynasty (1644-1911).

The latticework of streets housed the eunuchs of the imperial household; the markets for coal, jewellery or goats; historical columns dedicated to the unicorn, or the courtyards of the Wendefang, or Literature and Morality district.

By the 1980s, when China began opening up, there were 3,679 alleys in Beijing, but rampant development has destroyed many of these beautiful lanes. The number of hutongs has fallen 40 per cent since then as planners clear the precincts to make way for roads and gleaming office blocks.

The areas to be demolished are marked with the character chai, which means "demolish". The pace of destruction was expected to slow as 2008 neared, but new chai signs are still going up. Some of the demolition is linked to projects for the 2008 Olympic Games to be held in the capital, but much of the old city has been knocked down.

Mao Zedong started the process in the 1950s, when he moved many factories into the city. But the Great Helmsman's impact on the hutongs has been dwarfed by efforts to create the capital as a world city, complete with world-scale office buildings in the central business district, and the signature Olympic buildings springing up on the former sites of ancient communities.

A survey by the Beijing Institute of Civil Engineering and Architecture examined 1,320 traditional streets and lanes and found 15 per cent had been destroyed to make way for new buildings. A further 52 per cent had managed to retain something of their original condition but suffered serious damage. Many traditional courtyard houses were destroyed. Only a third of the hutongs have retained their original character.

Many people fear Beijing has lost something of its essence and redevelopment has not been peaceful. But those who have been resettled are happy to have left cramped courtyard houses, often with multiple families per building, for modern apartments, with much-improved facilities.

But they complain that the community spirit is gone. There are also cases of corrupt developers pocketing their compensation money, and armed thugs have been involved in illegally moving out the more stubborn hutong residents.

Alarmed that there may be nothing of old Beijing for the visitors to see during the Olympics, the government has introduced restoration guidelines for the hutongs, requiring that they be rebuilt with original materials and retain their original grey colour. But many conservationists believe the damage has already been done.