Although there is no concensus in academia on the categorial status of monosyllabic localizers in Mandarin Chinese, a relatively consistent view exists regarding disyllabic localizers. It is generally accepted that most disyllabic localizers used alone or following nominals function as place words, with a few exceptions serving as postpositions. This view likely stems from a lack of comprehensive and systematic observation of the semantic and syntactic functions of disyllabic localizers. The categorial status of disyllabic localizers is probably more complex than what the literature suggests. This article examines the categorial status of disyllabic localizers through the lens of Systemic Functional Linguistics, which highlights a function-oriented approach to language description. By detailing their semantic and syntactic functions and referencing the functions of nouns and prepostions, this article proposes the following viewpoints: Most disyllabic localizers can stand alone and, in these instances, are treated as nouns. A few exceptions, including yĭnèi (以内“within”）and six others, are rarely used independently and primarily function as postpositions. Post-nominal disyllabic localizers are undergoing grammaticalization, emphasizing positional relationships rather than relative positions. Their semantic and syntactic functions are complex and diverse. In some situations—when their preceding nominals can be deleted, when de (的“REL”) can intervene between them and their preceding nominals, and when corresponding monosyllabic localizers can replace them, they serve as both postpositions and nouns. In other situations—when de (的“REL”）cannot intervene between them and their preceding nominals, they are primarily postpositions.