Chinese officials regularly say they have uncovered terrorist groups or foiled plots in Xinjiang, but few details are usually given.
Human rights groups have accused Chinese authorities of using allegations of terrorism to suppress peaceful pro-independence sentiment among Xinjiang's indigenous ethnic Uighurs.
The Uighurs, Turkic-speaking Muslims, are distinct from China's ethnic majority Han who increasingly dominate economic life in Xinjiang.
Kashgar, an ancient stopover on the Silk Route linking Europe and Asia, is a traditional centre for Uighur culture.
The China Daily quoted Zhang Jian, the top Communist Party official in Kashgar, as saying there were signs that the cells had foreign links and were given orders by "remote control" via the internet.
"We know that the extremists will keep attempting to separate Xinjiang from China, and we know they will never get what they want," the report quoted Zhang as saying.
He added however that the government believed the number of people joining such cells was declining.
During last year's Olympic games in Beijing there were at least three attacks against police and paramilitary troops in or near Kashgar, which Chinese authorities attributed to Uighur separatists.
In April, two Uighur men were executed in Kashgar for what Chinese authorities said was a "terrorist" attack in the city last August that left 17 policemen dead.
At the time police said the attack had been aimed at sabotaging the Olympics.