Forest trees are long-lived, woody perennial plants that represent over 80% of terrestrial biomass. Despite their ecological importance, our current understanding of the structure and dynamics of forest tree genomes is very limited. Developing genomic resources to study the responses of forest trees to environmental changes and diseases associated with invasive species and pests is essential for enhancing the health of natural forest populations. The chestnut blight fungus (Cryphonectria parasitica) is the root cause of the epidemic that destroyed the American chestnut (Castanea dentata) tree populations in North America. Although the Chinese chestnut (Castanea mollisima) and American chestnut are closely related species in the Fagaceae family, it is known that the Chinese chestnut is resistant to the chestnut blight fungus. The main objectives of the Chinese chestnut genome sequencing project are to provide a high quality reference genome with resources for discovery of blight resistance genes, and for studying the evolution of disease resistance in forest trees. The genome size of Chinese chestnut is estimated to be about 800Mb. Using mostly next generation sequencing technology, we have obtained genome coverages of 22X and 47X from 454 and Illumina sequencing, respectively. In addition, we have obtained high quality BAC end sequences from traditional Sanger sequencing to improve on the quality of the genome assembly. We provide an update on the genome sequencing, assembly and analysis results. This project is supported by grant number 137RFP#2008011 from the U.S. Endowment for Forestry and Communities Forest Health Initiative.