Xiao Baojuan is an arbitrary and violent ruler, and he often executes high level officials based on his perception of them as threats to his rule.

He executes his prime minister Xiao Yi in winter 500, and Xiao Yi's brother Xiao Yan, the governor of Yong Province (modern northwestern Hubei) declares a rebellion from the capital of Yong Province, Xiangyang (in modern Xiangfan, Hubei).

In response, Xiao Baojuan sends the general Liu Shanyang to Jing Province, ordering him to rendezvous with Xiao Yingzhou and then attack Xiangyang.

Xiao Yan, however, persuades Xiao Yingzhou that Liu's orders are to attack both Jing and Yong Provinces, and Xiao Yingzhou, after making Liu believe his good faith by executing Xiao Yan's messenger Wang Tianhu, surprises and kills Liu, seizing his forces.

He then openly declares rebellion and supports Xiao Baorong as nominal leader.