The dynasty was founded in Xi'an on 8 February 1644, the first day of the lunar year, by Li Zicheng, the leader of a large peasant rebellion, by proclaiming himself "emperor" (皇帝) instead of the title "king" (王) before founding the dynasty.

The capture of Beijing by the Shun forces in April 1644 marked the end of the Ming dynasty, but Li Zicheng failed to solidify his political and military control, and in late May 1644 he was defeated at the Battle of Shanhai Pass by the joint forces of Ming general Wu Sangui who defected to the Qing dynasty after the fall of the Ming dynasty, with Manchu prince Dorgon.

When he fled back to Beijing in early June, Li finally proclaimed himself the Yongchang Emperor of the Great Shun and left the capital the next day after setting the palace ablaze and ransacking the government offices.

He may have intended to resume his Imperial claims later on by proclaiming his accession in the Forbidden City.

With the Shun ministers constantly fighting for power, the dynasty effectively lasted less than a year.