Abstract: As the demolition-and-redevelopment mode of urban renewal dominated by real estate development and the renovation model reliant on government funding have become increasingly difficult to sustain, the resident-led regeneration model in historic cities has gained attention. This paper reviews the historical evolution of autonomous regeneration models, concluding that they have been the mainstream approach to conservation and renewal in historic cities. This study identifies and analyzes institutional obstacles and root causes that hinder the application of this model in four aspects: project approval processes, benefit distribution management, compatibility with technical standards, and changes in property rights registration. It proposes a sustainable autonomous renewal model of “self-regeneration under unified plans”, Additionally, the study outlines a framework for institutional optimization, including clarifying the requirements of administrative licensing, defining bottom-line protection rules and benefit management boundaries, optimizing construction and acceptance criteria, and streamlining the process of property right replacement registration. The paper concludes by highlighting the linkage between autonomous renewal models, land-based finance mechanisms, and grassroots governance systems, offering policy outlook for urban renewal in historic cities.