The 35-year-old female farmer with the surname Xu died Tuesday after falling ill on November 11, the Ministry of Health announced Wednesday according to the state-run Xinhua news agency.
She had contact with sick and dead poultry, according to the report.
The World Health Organization has confirmed the woman died from H5N1 avian influenza, according to spokesman Dick Thompson.
"It was not unexpected," Thompson said. "There will be sporadic human cases as long as the virus is circulating in animals."
The case "doesn't change our pandemic level or risk assessment," he added.
A 24-year-old female poultry worker in Anhui died from the virus on November 10, and a 9-year-old boy who fell ill with the virus last month in Hunan Province is still alive.
China's Ministry of Health has reported a fourth human case of bird flu -- the boy's 12-year-old sister, who died on October 17 -- but the World Health Organization said there were no samples to test if she had the virus because she was cremated.
Avian influenza has spread rapidly among birds, first in Southeast Asia and more recently in Europe, but human cases have been reported only in Asia.
According to the WHO, 131 people have been infected with the H5N1 avian flu strain in China, Indonesia, Thailand, Vietnam and Cambodia, according to the Centers of Disease Control. Of those, 68 have died.
Earlier this month, U.N. Secretary-General Kofi Annan called on the international community to make immediate preparations for a possible pandemic of bird flu.
While it is not yet clear if the H5N1 strain will ever gain the ability to infect large numbers of people, Annan said world leaders cannot ignore the threat it poses.
On Tuesday China described the disease as a serious epidemic. "The government is making all efforts to combat bird flu, which is a serious epidemic in China," Liu Jianchao, a Chinese Foreign Ministry spokesman, told reporters at a routine briefing.
Liu added that China was still "facing serious challenges" and that the country "will step up our efforts in order to resolve this bird flu issue."
Earlier, Japan, Hong Kong and Taiwan followed the United States in temporarily halting poultry imports from mainland British Columbia after Canadian officials said they found a duck infected with bird flu, The Associated Press reports.
Canadian authorities, however, say the bird flu found is of a less virulent strain than the virus affecting Asian countries.
Meanwhile, Russian veterinary authorities said Tuesday that bird flu had been detected in a southern region and that measures were being taken to prevent it from spreading, AP reports.
The country's veterinary service identified the H5 type of bird flu in 200 swans that were found dead in the Volga River delta in the Astrakhan region, the Agriculture Ministry said. It had not yet been determined if it was the H5N1 strain.
And Japan has reported that signs of a bird flu infection were found at a poultry farm in northern Japan. It was the latest in a series of outbreaks that has led to the killing of about 1.6 million chickens over the past few months in the region.
The birds in the town of Ogawa -- 100 kilometers (62 miles) northeast of Tokyo -- were being tested, and the results were determine whether 290,000 chickens would be culled, said Ibaraki Prefectural (state) official Osamu Kamogawa.
Elsewhere, Indonesia's health minister, Siti Fadilah Supari, said the number of human bird flu cases was likely to be far higher than reported because of poor surveillance outside the capital, Jakarta, AP reports.
The government planned a nationwide campaign to measure the extent of the virus in the sprawling country of more than 13,000 islands, he said.
All but two of Indonesia's 11 confirmed cases of bird flu -- seven of which have been fatal -- have occurred in the greater Jakarta area.