Each time a man comes to her hotel asking for someone as clever as she is willing, Xun’s boss calls out for a “Number One.” On a scale of four, it’s the highest ranking, reserved for college girls. But that’s hardly a source of pride for Xun. “One has to survive and keep one’s life going, and I have to just ignore the negative side of what I am doing now,” says Xun, who will soon be a senior at Zhong Nan Financial University and asked that only her first name be used. “I’ve been able to send money back to my parents on a regular basis. I don’t dare send them too much because they will suspect where it came from.”

In cities across China, prostitution has become so widespread that even the educated elite are getting into the business. The Communist Party all but stamped out the sex trade in the 1950s, in part by forcing neighborhood spies to note the arrival and departure of male visitors to each household and by declaring pimping a capital offense. But the practice was resurrected in the 1980s when China introduced capitalist-style reforms. Desperate women who lost state jobs and benefits sold themselves to eager, newly rich men. Today there are more than 10 million prostitutes across the country.

No longer are all of them uneducated factory workers; college students and recent graduates, too, are joining the oldest profession. Many come from the countryside to the big city unprepared for the high cost of living or the materialistic culture. Some receive no financial support from their parents and cannot afford tuition doing a legitimate job. Others envy their classmates who manage to pay their fees and also treat themselves to fancy dinners, wear the hippest clothes, and jet off on weekend excursions. For many of these women, prostitution represents an escape from the bleak, circumscribed lives led by their parents–factory employees, poor farmers, or laid-off workers. “There is a high demand for the well-educated call girl,” says Li Yinhe, a well-known sex researcher at the Chinese Academy of Social Sciences.

Prostitution is a major embarrassment for the party, which early on built its reputation on wiping out social ills. So the central government largely ignores it, even as sexually transmitted diseases such as AIDS and gonorrhea rage across the sex worker population and threaten the health of the country. That willful blindness is proving harder to maintain, though. One national newspaper recently reported that about 8 percent of college students in Wuhan–which means at least several hundred–trade sexual favors for money. Beijing forced the newspaper, the Youth Reference Daily, to print a retraction and fire the reporter responsible for the story, Chen Jieren. Yet after the article appeared, Wuhan officials also cracked down on owners of establishments along the infamous “Bar Street” near Wuhan University, warning them not to harbor sex workers.

The allure on both the supply and demand side, however, still trumps authorities’ best intentions. Rich men on business trips continue to visit the street to meet college women–some who are already professionals and others whom they can persuade. “There is a big temptation when you see these rich men, because I am a poor student,” says Wang Fang, a Wuhan University student who took a summer job serving drinks at the Big Mouth bar near campus. Wang says men implore her to party with them in return for cash, but she resists. She understands why other young women succumb, though. “The life of my classmates is very hard. Some come from families that earn only 300 yuan a month,” or less than $40.

Of course, it’s not always desperately poor women who become prostitutes. Take Qi, a 24-year-old Wuhan native who dropped out of the Hubei Cadres’ School for Economic Management after three years, in part because she saw girls her age earning thousands of dollars working as escorts or hookers. “Life is short and we should enjoy it,” says Qi, glancing down at her watch from time to time. “Not only girls from poor families are doing the job, girls from rich families are doing the same. No one hates money, and no one is afraid of earning too much.” Qi, who asked to be identified only by first name, works during the day at a drugstore selling Maybelline makeup. But a few nights a week she perches on a sofa in the plush lobby of a local five-star hotel in Wuhan, where she easily meets traveling businessmen looking for company.

Many Chinese experts argue that the country should legalize prostitution. “A woman has the right to do whatever she wants with her body, to make money with her body,” says Li, the sex researcher. Personal freedom aside, regulating the sex trade could prove essential in stopping the spread of AIDS, which affects at least 1 million people by Beijing estimates–activists say the number is much higher–and is perhaps the biggest crisis facing China. (The prostitutes interviewed for this story–all of whom are college educated–said they don’t always use condoms and think that simply washing after sex can prevent disease.) “The government is at a crossroads. If it legalizes prostitution it will ruin its socialist reputation, but if it doesn’t, AIDS and other sexual diseases will destabilize society,” says Liu Dalin, a professor at Shanghai University. It’s a hard choice, just as hard as that faced by far too many of China’s young women.