Between 364 and 370 CE, a medium named Yang Xi, serving the aristocratic Xu family near Jiankang in southern China, reported a series of nocturnal visitations from a group of transcendent beings who dictated texts, instructions and revelations concerning the structure of the heavens, methods of meditation and visualization, and the spiritual standing of named individuals, living and dead. Yang transmitted these revelations in writing to his patrons, Xu Mi and his son Xu Hui, both already practitioners of Daoist and religious techniques, who preserved and circulated the resulting texts within their family and social circle.
The revelations described a celestial realm called Shangqing, Highest Clarity, understood as a level of heaven superior to those associated with earlier Daoist and popular religious traditions, and presented Yang's visionary informants as ranking accordingly above the deities and immortals already familiar from Celestial Master and other traditions. The resulting body of scripture emphasized inner visualization and meditative practice, imagining the practitioner's body as inhabited by resident spirits requiring cultivation, alongside more traditional Daoist concerns with longevity and transcendence.
Maoshan, in present day Jiangsu, associated with the Xu family's activity, became the school's principal later center, and the tradition it produced, Shangqing Daoism, is named for the celestial realm the revelations described.