Lieutenant General Liu Yuan said on Wednesday that any strike on the world's biggest hydropower project would kill thousands of civilians and would lead to war.
In its annual report to Congress on China's military power, the Pentagon suggested in May that Taiwan target the dam as a deterrent.
The US Department of Defence believes such a threat would stop any Chinese invasion of the island, which split from the mainland in 1949 and is still regarded by Beijing as a breakaway province.
But Liu said - in comments to the official China Youth Daily newspaper - that attacking the dam was no deterrent at all.
"[Targeting the dam] will provoke retaliation that will 'blot out the sky and cover up the earth'," he said, quoting a Chinese idiom.
The warning came as the Defence Ministry in Taiwan said it had test-fired two Patriot anti-missile missiles to demonstrate its air-defence capability.
"Presenting credible threats to China's urban population or high-value targets, such as the
Three Gorges Dam, will deter Chinese military coercion"
Pentagon report to Congress
Liu asserted that no country had conventional warhead missiles capable of critically damaging the dam - made of concrete with a maximum thickness of more than 100 metres.
Seismologists have said the dam is designed to withstand an earthquake measuring 10 on the Richter scale.
The Pentagon report believes the dam could be targeted.
"Since Taipei cannot match Beijing's ability to field offensive systems, proponents of strikes against the mainland apparently hope that merely presenting credible threats to China's urban population or high-value targets, such as the
Three Gorges Dam, will deter Chinese military coercion," it said.
A Chinese Foreign Ministry spokesman said last week the report was "Cold War mentality harbouring evil intentions".
US President George Bush has pledged to do whatever it takes to help "democratic Taiwan" defend itself against a Chinese invasion.