Lo Stato di Shan fa parte di Myanmar e confina con la Cina a Nord, con il Laos ad Est e con la Thailandia a Sud. Il fiume Mekong segna i confini dello Shan con il Laos. Questa regione di frontiera è nota con l'attributo di "Triangolo d'oro", sebbene il termine si riferisca più specificatamente nella zona del fiume Mekong in cui si incontrano i confini di Myanmar, Thailandia e Laos. Il triangolo d'oro era un'area in cui si produceva oppio in quantità notevoli. Oggi la produzione è scesa di parecchio.
The Shan people in Myanmar are the same as the Dai people in China's Yunnan Province. The Shan people are one of the largest minority groups in Myanmar. They have been fighting an on-and-off war with the central Myanmar government for several decades. The central Myanmar government has signed peace agreements with factional groups in the Shan State, which allows these groups to have a high degree of autonomy, including maintaining separate armed forces. The political situation, however, remains relatively unstable. Many military checkpoints exist on few major roads that cross the mountainous Shan State. Each checkpoint marks the border between a territory (usually a Special District or a city) controlled by a different army. In July 2005, the central government official responsible for negotiating these peace agreements was sent to jail for corruption, possibly signalling a renewed attempt by the central government to crack down on the rebel Shan armies.
The daily market in the regional administrative city of Kengtung is a sprawling complex with a wide variety of goods, including tourist souvenirs - though they do not get many tourists. Instead the market is full of local residents and hill tribe people dressed in their colorful traditional clothing, and Buddhist monks and nuns with their begging bowls. A visit can easily consume half a day of people watching, shopping and bargaining (this market is much more interesting than the border market in Tachileik, where hawkers harass tourists with soft porn and cigarettes).