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Threat Actors & CampaignsEmerging1 sourceSep 8, 2026 · 12:00via CISA Alerts

China-Based Artificial Intelligence Companies Conducting Industrial-Scale Distillation Campaigns Against U.S. AI Companies

Brief

Executive summary

China-based artificial intelligence (AI) companies are conducting systematic extraction of proprietary functionalities and capabilities of U. S. AI companies’ models through industrial-scale knowledge distillation campaigns that form the core—not merely a supplement—of their AI development strategy.

While “distillation” is recognized as a legitimate and useful technique in AI research, China-based AI companies are engaging in aggressive, malicious, and targeted distillation activities at an industrial scale that extract restricted proprietary functionalities and capabilities of U. S. frontier AI models.

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