“Painted Skin: The Resurrection” has reaped the benefit of the mid-summer blackout of foreign movies to become the highest-grossing Chinese film of all time when it passed the 686 million yuan ($107.5 million) mark this week.

This weekend, the actioner from young Inner Mongolian helmer Wuershan will look to extend its lead over previous domestic hits, Jiang Wen’s “Let The Bullets Fly” ($106 million) and Feng Xiaogang’s “Aftershock” ($105 million).

Local movies have been suffering badly at the hands of Hollywood tentpoles this year, and the government’s State Administration of Radio, Film and TV announced a “film protection month” for July, which now looks likely to be extended into August, and possibly beyond.

The biggest grossing films of all time in China to date are “Avatar” ($208 million), “Transformers: Dark of the Moon ” ($168 million) and “Titanic 3D” ($153 million).

“Painted Skin: The Resurrection” is shot in 3D, which helped boost receipts, and is a sequel to the 2008 “Painted Skin,” about a general’s relationship with a princess and a fox demon.

The pic has been destined for great things since it took in the third-highest opening day receipts at 70 million yuan ($11 million).

According to SARFT data, total B.O. in China is up 40% year on year — to 8.07 billion yuan ($1.26 billion) for the first half of the year — but the take for domestic films is down 4.3%.

— Robert Mitchell in London contributed to this report.