He was famous for supporting reforms toward capitalism, free markets, and liberalization in China. In 1987, socialist hardliners forced him to resign for his "laxness" on "bourgeois liberalization".
A day after his death, a small scale protest mourned for him. A week later, the day before Hu's funeral, some 100,000 students marched on Tiananmen square, leading to the Tiananmen Square protests of 1989.
Hu Yaobang's luck seemed to have run out after the Long March when he was forced to march with the communist leader Zhang Guotao's 21,800+ strong forces to cross the Yellow River in a futile attempt to expand the communist base westward in Shaanxi and to link up with the former Soviet Union, or at least with Xinjiang, which was controlled by the warlord Sheng Shicai, an ally of the communists and the former Soviet Union. Zhang Guotao's forces were soundly defeated by the local nationalist warlords, the Ma clique. Hu Yaobang, along with Qin Jiwei, became two of the thousands of prisoners-of-war captured by Ma clique's forces. Hu was one of only 1,500 prisoners-of-war whom Ma Bufang decided to use as forced labor rather than execute. As Chiang Kai-shek pressured Ma Bufang to contribute more of his troops to fight Japanese invaders, Ma Bufang decided that instead of using his own troops, he would instead send the 1,500 Chinese Red Army prisoners-of-war as conscripts. Since the marching route had to pass the border of the communist base in Shaanxi, Hu Yaobang and Qin Jiwei seized this opportunity to return to the communists and organize a planned escape in secrecy. The escape took place as planned and was a success: out of the total (1,500), more than 1,300 had successfully returned to Yan'an. Mao Zedong personally welcomed these returning communists and Hu Yaobang was once again back in the communist camp, where he would remain for rest of his life. However, the political persecution continued, and from the very communist leader Hu Yaobang once firmly supported.
During his time in office, Hu tried to rehabilitate the people who were persecuted during the Cultural Revolution. Many Chinese people think that this was his most important achievement. He was also in favor of a pragmatic policy in Tibet, ordering the withdrawal of thousands of Chinese Han cadres from the Tibet Autonomous Region following a 1980 visit to the region, believing that Tibetans should be empowered to administer their own affairs.
Although Hu was a dedicated reformer and one of Deng Xiaoping's most important associates, he was later forced to resign in 1987 from his post as General Secretary; leaving officially on 16 January. Deng forced Hu to resign on the heels of a series of student demonstrations in late 1986, believed by the hardliners as a consequence of Hu's tolerance of and perhaps his empathetic attitude towards China's liberal intelligentsia, who were pushing for more political freedom and reform. He was also accused of "making mistakes in Sino-Japanese relations".
Hu Yaobang died due to a heart attack two years later at a Party Political Bureau meeting on 15 April 1989. In his death announcement, he was described as: "Comrade Hu Yaobang was a long-tested and staunch communist warrior, a great proletarian revolutionist and statesman, an outstanding political leader for the Chinese army". Although he was a "retired" official who had made "mistakes", public pressure forced the CPC to accord him a State Funeral attended by party leaders, and a eulogy which praised his work in restoring political norm and promoting economic development after the Cultural Revolution.
However, many people were dissatisfied with the party's slow response and relatively subdued funerary arrangements. Public mourning began on the streets of Beijing and elsewhere. In Beijing this was centred on the Monument to the People's Heroes in Tiananmen Square. The mourning became a public conduit for anger against perceived nepotism in the government, the unfair dismissal and early death of Hu, and the behind-the-scenes role of the "old men", officially retired leaders who nevertheless maintained quasi-legal power, such as Deng Xiaoping. Protests eventually escalated into the Tiananmen Square protests of 1989. Hu's ideas of freedom of speech and freedom of press in 1986 greatly influenced the students participating in the protests.
After Hu's funeral, his body was cremated. There are reports that initially his widow wanted his ashes to be buried in his home town of Liuyang. However, the local leaders hesitated to accept such a controversial bequest, and he was eventually buried at Gongqing Cheng (literally "Communist Youth City").
Plans to rehabilitate Hu Yaobang were reported in the Washington Post 9 September 2005. Based on Chinese sources, the article "China Plans To Honor A Reformer" reported planning for events on 20 November, the 90th anniversary of his birth. An official biography and a collection of his writings were slated for release. The biography is a source of controversy as there is a three volume biography written by former aides to Hu Yaobang which remains unpublished and has been taken into the control of the government. A memorial was planned in Hunan where he was born. While viewed by some observers as a possible preliminary step to re-evaluation of the Tiananmen Square protests of 1989, such a move continues to be rejected.
On 18 November 2005, The Communist Party officially celebrated the 90th anniversary of Hu Yaobang's birth (date was changed to two days before), with activities at the People's Hall.
Although magazines publishing commemorative articles were initially stopped from being released, the ban was lifted and these magazines were publicly issued.
This was the first time since his death that Hu's name appeared publicly. It has been suggested that he will be "rehabilitated", giving hope that the Tiananmen Square Protests might be re-evaluated by the CPC.
Memorials in recognition of the date of someone's birth or death are often signs of political trends within China, with some pointing to the prospect of further reform. This is countered however by other recent statements from the Party that it should learn from the ideologies of Cuba and North Korea.
Some political analysts have argued that the current administration under President Hu Jintao wishes to associate itself with the popular Hu Yaobang. Both rose to power through the Communist Youth League, and are described as part of the same "Youth League Clique". Hu Yaobang was also responsible for promoting Hu Jintao to the CPC central office.