The development drew praise from the World Health Organization (WHO) on Thursday who said the vaccine, which will be given to Chinese children as part of routine disease prevention, would help the global fight against the polio virus.
China's private and state-run medical laboratories have been growing in sophistication, helping reduce reliance on imported medicines and competing with global rivals.
"This new vaccine is a critically important weapon in the fight against polio as the world nears the eradication of this dreaded disease," Bernhard Schwartlander, WHO representative in China, said in a statement.
China technically eradicated polio in 2000, but there have been outbreaks of the disease in the country since.
China's drug regulator approved the new vaccine, called Ai Bi Wei, on Wednesday, according to a statement from the China Food and Drug Administration (CFDA). The vaccine was developed by the Chinese Academy of Medical Sciences.
China approved a domestically developed experimental Ebola vaccine for clinical trials in December.
China currently produces an oral vaccine to protect against polio, but it can in some cases cause people to develop the disease. The CFDA said it expected demand for the new vaccine to be in the tens of millions of doses each year.
"As an important innovative product which our country has the full intellectual property rights to, the approval of this vaccine is a successful leap forward to take China's vaccines from "made in China" to "created in China," it said.
Driven by a boom in pharmaceutical-related patents, China is now the world leader in terms of patent applications, according to a Reuters report last month.