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The official currency in mainland China is the Renminbi (RMB) or "People's currency." The basic unit is the yuan (also known as ‘kuai'), which equals 10 jiao.
You can exchange traveler's checks or cash at most banks, and most hotels in the cities, the exchange rate in the hotels is the same as that in the banks. To change money, you have to have your passport at hand. If you want to change money in a hotel, you usually have to be a guest there. Sometimes if you are not a guest in a hotel but need to change money there, you can just say a random room number, but this doesn't always work.. Whenever you change the money, please keep the exchange receipts well in case you need to exchange back into the original currency upon your leaving from China.
You can use US dollars / Euros/ English pounds/ in the hotels to pay for the bill, in the friendship stores, to buy things from those vendors outside the scenic spots, to pay for any optional tours and to tip porters of the hotels, tour guides and drivers or whomever you want to tip. While you can not use US dollars or some other foreign currencies in department stores or small convenience stores, local restaurants, or if you try to buy things from street vendors.