China has summoned the US ambassdor in Beijing after the FBI indicted five of its military officers with charges of cyber espionage.
Chinese officials told Ambassador Max Baucus that the accusations had seriously harmed relations between the two countries, state news agency Xinhua reported on Tuesday.
The officers are accused of hacking into American companies to steal trade secrets in the nuclear, metal and solar energy sectors.
A spokeman for China's Foreign Ministry said that the charges had "seriously violated the basic principles of international relations".
Spokesman Hong Lei also described the accusations as "deliberately made up facts", the Reuters news agency reported.
The indictment was the first criminal hacking charge that the United States has filed against specific foreign officials, and follows a steady increase in tensions between China and the US.
The latest dispute adds to a catalogue of issues straining diplomatic ties between the two countries. Washington and Beijing have disagreements over trade, human rights and China's expanding military reach in the seas it shares with its neighbours.
China's Assistant Foreign Minister Zheng Zeguang told Baucus that the US attitude to Internet security was "hypocritical" and asked for an explanation into reports that Washington had spied on Chinese interests.
The country's Foreign Ministry said it would suspend the activities of a China-US working group on cyber issues.
It is unlikely that the US would be able to arrest those indicted because China would not hand them over. However, the charges mean the officers would face obstacles if they wanted to travel abroad.
To avoid being arrested, those accused would have to steer clear from travelling to the US and countries that have an extradition agreement with it.
US prosecutors say the suspects targeted complanies including, Toshiba Corp, United States Steel Corp, and several others.