Based on Chinese context, this paper uses classical grounded theory methodology, makes the sanitation service outsourcing of Guangzhou and Shenzhen basic government as samples, researches the causes of public service outsourcing of grassroots governments in China. It founds out that the causes of the outsourcing include external causes and internal causes, influenced by public and economic factors. It also discovers a phenomenon called incomplete outsourcing of public service function and political pressure strengthen is the cause of this phenomenon. Using classical grounded theory is the methodology innovation of the research.