For the first year of the principality's existence, Chen, whose army was defeated but who eluded capture, remained a threat, until Zhou Bo killed him in battle in November or December 196 BCE.

In August 180 BCE, after Grand Empress Dowager Lü died and the officials made a coup d'etat against her clan and slaughtered them (during the Lü Clan Disturbance), after some deliberation, the officials offered the imperial throne to Prince Heng, rather than Prince Liu Xiang of Qi, the oldest grandson of Emperor Gao.

[citation needed] Emperor Wen quickly showed an aptitude to govern the empire with diligence, and appeared to be genuinely concerned for the people's welfare.

Heavily influenced by his wife Empress Dou, who was an adherent of Taoism, Emperor Wen governed the country with the general policies of non-interference with the people and relaxed laws.

He was initially very deferential to Zhou Bo, Chen Ping, and Guan Ying (灌嬰), who were instrumental in his accession, and they served as successive prime ministers.

In 175 BCE, over the objections of Jia Yi, Emperor Wen issued an edict permitting any person to mint money (then only in the form of coins) out of copper and tin.

Another beneficiary was Liu Pi, the Prince of Wu, whose principality had a major copper mine at Yuzhang (豫章, in modern Nanchang, Jiangxi).

In 174 BCE, a major incident occurred involving Liu Chang, the Prince of Chen, who was by then Emperor Wen's only living brother.

When the conspiracy was discovered, Emperor Wen stripped Prince Chang of his title and exiled him to Yandao—with the intent to teach him a lesson and then summoning him back.

Also in 174 BCE, when the Xiongnu's new chanyu Laoshang came to power, Emperor Wen continued the heqin policy by giving him a prince's daughter in marriage.

In 169 BCE, Chao Cuo (晁錯), then a low-level official, offered Emperor Wen a number of suggestions for dealing with the Xiongnu.

At Chao's suggestion, in 168 BCE, Emperor Wen instituted the policy that if people contributed food for use by the northern defense force against Xiongnu, they could receive titles or have their crimes pardoned.

In 167 BCE, Emperor Wen banned the corporal punishments of facial tattoo and cutting off the nose or a foot, and replaced them with whipping.

In 165 BCE, at the instigation of the sorcerer Xinyuan Ping (新垣平), he built a temple north of Wei River dedicated to five gods.

In 164 BCE, Xinyuan Ping had an associate place a jade cup outside the imperial palace with mysterious writings on them, and also predicted a regression in the path of the sun.

In 158 BCE, when the Xiongnu made a major incursion into the Commanderies of Shang (上, modern northern Shaanxi) and Yunzhong (雲中, modern western Inner Mongolia, centered on Hohhot), Emperor Wen made a visit to the camps of armies preparing to defend the capital Chang'an against a potential Xiongnu attack.

Later, he would leave instructions for Crown Prince Qi that if military emergencies arose, he should make Zhou his commander of armed forces—instructions that were heeded during the Rebellion of the Seven States.

His reign was marked by thriftiness and attempts to reduce burdens on the people, with one of the lowest tax rate in Chinese history was recorded.