From the founding of the People's Republic of China to the handover in 1997, Hong Kong, under the British governance, was a city with a relatively high degree of openness in terms of finance, trade, and tourism. Compared with Hong Kong, Macao, under the Portuguese governance, was a city with a low degree of openness. After the handover, under the principle of "One Country, Two Systems", the Central Government is in charge of diplomatic affairs related with Hong Kong and Macao, whereas Hong Kong and Macao are empowered to deal with relevant external affairs. However, the Basic Laws do not define clearly diplomatic and external relations. Therefore, there exist ambiguities when Hong Kong and Macao deal with external relations. Since the founding of the People's Republic of China, the local governance of the Central Government has gradually turned to decentralization, and the local governments display their own advantages in terms of non-traditional diplomacy. This study employs case study and applies multi-layered diplomacy and para diplomacy to discuss problems encountered by Hong Kong and Macao in dealing with external relations and provide guidance for the future development of Hong Kong and Macao's external relations. Keywords: Traditional Diplomacy, Multi-layered Diplomacy, Paradiplomacy, the principle of "One Country, Two System", Governance, External Relations