A new Zhang and McFarlane (ZM) cumulus scheme includes a two-moment cloud microphysics parameterization for convective clouds. This allows aerosol effects to be investigated more comprehensively by linking aerosols with microphysical processes in both stratiform clouds that are explicitly resolved and convective clouds that are parameterized in climate models. This new scheme is implemented in the Weather Research and Forecasting model, coupled with the physics and aerosol packages from the Community Atmospheric Model version 5. A case of July 2008 during the East Asian summer monsoon is selected to evaluate the performance of the new ZM and to investigate aerosol effects on monsoon precipitation. The precipitation and radiative fluxes simulated by the new ZM show a better agreement with observations compared to simulations with the original ZM that does not include convective cloud microphysics and aerosol-convective cloud interactions. Detailed analysis suggests that an increase in detrained cloud water and ice mass by the new ZM is responsible for this improvement. Aerosol impacts on cloud properties, precipitation, and radiation are examined by reducing the primary aerosols and anthropogenic emissions to 30% of those in the present (polluted) condition. The simulated surface precipitation is reduced by 9.8% from clean to polluted environment, and the reduction is less significant when microphysics processes are excluded from the cumulus clouds. Cloud fraction is reduced by the increased aerosols due to suppressed convection, except during some heavy precipitation periods when cloud fraction, cloud top height, and rain rate are increased due to enhanced convection.