Thirty employees at a Wal-Mart store in the southeastern city of Quanzhou, in Fujian province, have voted to form the union, the official Xinhua News Agency reported on Sunday.
It said a 29-year-old employee named Ke Yunlong was elected chairman of its seven-member committee.
The official All-China Federation of Trade Unions has been lobbying Wal-Mart Stores Inc. for two years to organise employees of its 60 stores in China, and accused the company of obstructing its efforts.
Wal-Mart opened its first Chinese outlet in 1996 and says it has 28,000 employees in China.
It plans to add 18 to 20 stores on the mainland this year.
Phone calls by journalists to Wal-Mart's China headquarters in the southern city of Shenzhen were unanswered on Sunday.
Jailed and harassed
The ACFTU is the umbrella group for labour unions permitted by the communist government. It has been trying in recent years to expand its presence in private and foreign companies.
"One of the major tasks of the ACFTU in 2006 is to push foreign-funded or trans-national companies to unionise," Xinhua paraphrased Xu Deming, vice-president of the ACFTU, as saying.
China does not allow independent unions and activists are frequently jailed and harassed.
There are official labour unions in 39,000 of China's 100,000 foreign companies, according to Xinhua.
Xu said unions can look after workers' economic interests and "can also help 'lubricate' the relationship between employees and employers," Xinhua reported.