In 1943, while China was divided by civil war and at war with Japan, he joined the underground Communist Party.
After the Communist victory in 1949, he worked as an investigative reporter and editor at the China Youth Daily, the leading youth newspaper, where he practiced a formed of literary journalism that involved meticulous research and almost novelistic detail and description.
Yet during the 1950's, he began writing impassioned, thinly veiled critiques of the party's bureaucracy, and lifted the veil on corruption in the system.
In 1957 he was denounced as a "rightist" and expelled from the Communist Party. For the next two decades, he was in and out of forced labor camps and sometimes separated from his family.
In 1978, after Deng came to power, Mr. Liu was rehabilitated, readmitted to the party and given a job as a special reporter for People's Daily. Before long he was once again writing scathing attacks on the party bureaucracy. In 1979 he published his most famous work, "People or Monsters?", about a corruption case in northeastern China.
Mr. Liu's articles and essays in People's Daily and elsewhere made him into one of the most admired writers on the mainland, even though his depiction of the party was ugly.
"The Communist Party regulated everything," he wrote. "But it would not regulate the Communist Party."