The Chinese are on the move. In search of their history, their spiritual traditions, their temples, the places of natural beauty celebrated by their poets and painters, and of fun, pleasure and good food, they are criss-crossing their own country as tourists in a way they have never done before.

Only 10 or 15 years ago, most Chinese would neither have expected nor perhaps even wanted an annual vacation. Now they do, and their voyage of discovery and recovery in their own country is part of a burgeoning of domestic tourism which has, among other things, changed the nature of travel in China for foreigners.

The old kind of Chinese holiday, of five or 10 years ago, in which a sprinkling of westerners went on constrained tours on which they met few people other than hotel staff and guides, is long gone – just a memory. These days you are elbow to elbow with the masses, although perhaps a little better fed and watered. You don't go on holiday to China any more. You go on holiday with the Chinese.

This sharing of the tourist experience with a new Chinese middle class has become the essence of travel in China, fascinating and sometimes frustrating at the same time. But if the phrase "middle class" gives the impression of a relatively small elite, it would be a wrong one. Feats of organisation and a still expanding transport infrastructure funnel hundreds of thousands of people to the main destinations. In October's Golden Week last year (one of the country's semi-annual seven-day national holidays), 302 million tourist trips were recorded. When foreigners join these flows they are mere drops in the torrent.

Take Yellow Mountain, a vertiginous peak in Anhui province, and a famous beauty spot. It looks like a Chinese painting – conifers clinging to jagged, near-vertical cliffs, jungly clefts visible from thousands of feet above as you ascend in a state-of-the-art Austrian-built cable car with reassurances in three languages for white- knuckled passengers. When you get to the top you find a score of hotels ingeniously inserted into the crags, and a vast network of paths and steps leading to wonderfully named vantage points such as Monkey Gazing at the Sea, Cloud Dispelling Pavilion and Beginning To Believe.

Tourists watching sunrise at Mt. Huangshan, Anhui. Photograph: Alamy

You also find perhaps 20,000 other tourists, nearly all Chinese, and with them you labour up the endless steps, united in a wordless language of gasps, pants and suddenly wobbly knees. The triumph mingled with commiseration on the faces of those coming down encourages those yet to make the blessed transition from ascent to descent. In between, there are the views. It is moving to see how the Chinese pay their respects to beauty. There is no jostling, crowded though the viewing platforms are, little litter, no yelling, no tussles between young men. Instead, an almost religious attitude prevails.

Numbers like these demand complex technical back up. The mountain has its own police and emergency force who, rather charmingly, are also allowed to sell ice-lollies. Food, fuel, laundry and other necessities come up daily, carried on wooden yokes by porters. It would be too expensive, it is explained, to use the cable cars and anyway, people need the jobs. So, as elsewhere in China, traditional and taxing physical labour exists side-by-side with the most modern equipment.

The dichotomy that marks tourism everywhere – that your holiday is somebody else's hard work, and in any case has brought changes that may have damaged as well as enriched local people – is evident, too, in another Chinese phenomenon, the preserved village. By car and above all by coach, the Chinese converge on these places, typically approached through miles of unprepossessing and sometimes positively ugly urban and semi-urban tracts. Then, suddenly, like gold amid all this dross, the village is revealed.

These communities, such as the Wuzhen water village on the Changjiang river, near Hangzhou in Zhejiang province, are low-built in wood and stone, in a traditional grey and white Chinese style. They are astonishingly charming, but the fact that in some cases, such as Wuzhen, the original population has been entirely moved out, or, in others, carries on as slightly mutinous extras around the boutique hotels and shops, can give one pause. Artifice is another aspect: the difference between old and new, genuine and reconstructed, is not always that clear in China.

Hall of Five Hundred Arhats, Lingyin Temple, Hangzhou City, Zhejiang Province. Photograph: Tao Images/Getty

One village in which we stayed, Nanping in Anhui, takes things even further. It looks centuries old, and part of it is. But the hotel complex is in fact based on a film set used by the director Zhang Yimou for his 1989 film Ju-Dou. Courtyards, canals and inward-facing Chinese houses linked by narrow stone alleys constitute a wonderful maze at the centre of which is, surprisingly, an American bar complete with a neon sign and ancient Philip Morris cigarette advertisements. A scratch supper there of noodles with scrambled eggs and cold beer was one of the unexpected culinary high points of our trip. The beds in these village hotels are, incidentally, often of the old Chinese type, low wooden structures, with no mattress and just a couple of sheets: one sleeps like a baby.

Whether these spots are genuinely old or partly confected, the Chinese, most of them now from the big cities, approach them with a certain reverence, as reminders of their own not-too-distant past. The reverence is even more pronounced at religious sites. Incense sticks are constantly renewed at Buddhist temples by men and women who, if not always worshipping in the full sense, are certainly paying homage. Many kneel to pray, some bring offerings of fruit or flowers. The famous Temple of Soul's Retreat (Lingyin Temple) above Hangzhou West Lake is like a conveyor belt bearing pilgrims through its avenues and grottos to the temple proper. A steep climb above the temple, with the crowds rapidly thinning out, is a Buddhist tea room serving sublime tea and simple vegetarian food, one of the most peaceful places I have ever visited.

Reverence especially characterises the Chinese in Qufu, the birthplace of Confucius, in Shandong province. There in the huge burial ground where descendants of the sage are still being interred, winding paths lead between the tree-shaded tombs, most of the ground unmown and speckled with wild flowers. Groups of Chinese move quietly through, or stand around as guides explain: it is a natural cathedral, and one leaves it with reluctance. The Confucius family compound is impressive in a different way, one of those places characterised by a receding series of increasingly privileged and private spaces in the Chinese manner. The iconography is complicated and not easy to understand.

Ying Jia bridge in Wuzhen water village near Hangzhou. Photograph: Alamy

More obvious are the cracks and repairs that were a consequence of a vandalism that, only belatedly checked, might have destroyed even more of Confucius's physical heritage than it did. These, too, are silently contemplated by Chinese visitors, who are revisiting both the fifth century BC, when Confucius lived, and the 20th century, when Cultural Revolution activists toppled the tombs, smashed the statues and swept the altars of their ornaments and votive vessels.

Today's dangers are different. The damage that could be caused by a too intensively commercial tourism is obvious. Tourism-related projects are getting the same high — perhaps too high — attention and investment that other parts of China's infrastructure are receiving.

In 2009, the State Council designated tourism a "pillar industry". Attempts are being made to get the Chinese to take their holidays evenly throughout the year, changing the pattern in which certain key dates — May Day, the National Day weekend in October and the Spring festival — represent huge peaks. The many Chinese who still do not have, or do not take, their holidays are to be encouraged to do so. An expanded tourism will boost consumption, giving China a more balanced economy.

Yet for many poorer regions getting the balance right between encouraging tourism and the Disneyfication of their heritage is crucial. The boost to their local economies can be vital, but serious harm can also be done. Beautiful valleys have been stripped of their farms and filled with cheap and not very cheerful resort hotels or with dismal "fishing lodges" and farmed fish in concrete tanks.

There are political frictions too: tourism is not without the confrontations common in other areas of Chinese life. Thousands of tourists threw water bottles and blocked traffic recently because they thought a party of high officials was delaying their visit to a popular lake in Jilin province.

You can still get away from it all in China. If you drive north of Beijing to little visited stretches of the Great Wall, and can handle a stiff climb, you will find yourself gloriously perched on a tumbledown stone slab watching young Chinese in mountain gear and kneepads scrambling, abseiling and roping themselves up and down to the ruined guard houses that top each rollercoaster peak. They welcome you gleefully in often excellent English and then are off again like gazelles to the next one.

Technically illegal, but wonderful fun. It is another reminder that a Chinese holiday for westerners today is in part about watching and marvelling at Chinese tourists. Confucius's dictum "Wherever you go, go with all your heart" could well have been coined with such young people in mind.