This study provides insights into expanding the concepts of community arts in general and more specifically community-based art practices (CAP); highlights the participatory characteristics in the processes of CAP, and seeks to discern the mechanism that contributes to the formation of community collective identity. Revolving around Bhattacharyya’s (1995, 2004) conceptualization of community development, this study found it essential for exploring the fundamental concept of community in relation to community identity. To examine the concept of community identity, this research anchors the inquiry by studying how community-based art practice contributes to community identification and seeks to discover the connection between identity process and social change. The research also discusses the emergent concepts that serve as influential factors to the formation of community identity and proposes an alternative identification mechanism, ‘jen-tung’ process, which provides a needed new dimension to the existing theories of social identity formation and community efficacy development.