Diao Chan appears in the classic novel Romance of the Three Kingdoms in a plot involving the warrior Lü Bu and the warlord Dong Zhuo. According to historical records, Lü Bu did have relations with a maid of Dong Zhuo's. However, there is no evidence that this person's name was Diaochan. In fact, it is extremely unlikely that it was Diaochan, because "Diāo" was not, and is not, commonly used as a Chinese family name. "Diāochán" likely referred to the sable (diào) tails and jade decorations in the shape of cicadas (chán), which at the time adorned the hats of high-level officials.
According to the novel, Romance of the Three Kingdoms, Diao Chan assisted the official Wang Yun in a plot to persuade the warrior Lü Bu to kill his adopted father, the tyrannical warlord Dong Zhuo. She did this by becoming Dong Zhuo's concubine but also Lü Bu's betrothed, then manipulating the two through their jealousy and her charm. Dong Zhuo's tactician, Li Ru, saw that the dancing girl was driving both the lord and the warrior mad, so he proposed that Dong Zhuo give Diao Chan to Lü Bu instead of fighting over her. Upon hearing this he threatened Li Ru with death and stated that no warrior was worth what Diao Chan was to him. Diao Chan had Lü Bu wrapped around her finger.
She told him that being with Dong Zhuo made her unhappy and wished to only be with him. Lü Bu was outraged and went to Wang Yun to plot Dong Zhuo's death. Lü Bu had to escape shortly after killing Dong Zhuo and he lost a battle to Dong Zhuo's generals. He did, however, meet up with Diao Chan once more. Diao Chan followed Lü Bu during his time as a rogue leader until he took Cao Cao's castle of Puyang. Together they traveled the land until Lü Bu was later killed when Cao Cao's forces overran his base at Xiapi. There is no mention of Diao Chan in the novel after this.
In one Yuan Dynasty play, Diao Chan is introduced to Guan Yu by his 'brother' Zhang Fei after the death of Lü Bu, but instead of accepting her as the spoils of war, Guan Yu decapitates her with his sword. This event does not appear either on the history records or the novel itself, but is propagated through mass media such as operas and storytelling. There is also another idea of what happened to Diao Chan. There is also a source that says she did meet Guan Yu, but he let her become a nun. After hearing this, Cao Cao wanted to take her as his own. When the news reached Diao Chan, however, she committed suicide.