Qiu Xiang, 35, was from a nunnery in Dawu county of Garze in Sichuan province, a brief report the official Chinese news agency Xinhua said.
She set herself on fire at around noon. It was unclear why she killed herself and local authorities are investigating, Xinhua said.
However, Qiu is the second Tibetan nun to self-immolate in the past month and reportedly among a growing number of Tibetans who choose to set themselves on fire as a protest against China's rule of Tibet.
The Tibet independence group International Campaign for Tibet reported Qiu's sister nuns took her to the nunnery where she died soon after.
"Nuns began to pray for her," an unnamed source said. "The local authorities have locked down the area, closing a major road in Tawu (town) and deploying troops to the nunnery."
Last month Dawa Tsering, a monk in his 30s from Kardze Monastery, set fire to himself during a religious ceremony.
Many Tibetans in Sichuan are angry about what they see as a move by Beijing to move ethnic Han Chinese into the majority Tibetan areas of Sichuan province, in an effort to make Tibetans a minority.
In March 2008 four protesters in Aba were shot by security forces acting to contain anti-China demonstrations in the Tibetan regions, including in Lhasa in Tibet.
Much of the protest has centered in Sichuan province, in particular near the Kirti Buddhist monastery. The area around the monastery Kirti Gompa, founded in 1472 on the edge of Ngaba or Aba City, has been tense since Rigzin Phuntsog, a monk, set himself on fire and died in March.
Last month in Serthar, another town in Sichuan, several hundred people reportedly gathered to chant "We want freedom." They also reportedly called for the return of the Dalai Lama, the spiritual head of Tibetan Buddhism who has been in self-exile in Dharamsala, northern India, since just after China's army rolled into Tibet in the later 1950s.
Soon after the death of Phuntsog, the Dalai Lama, called for restraint on all sides, although Chinese authorities claim he foments nationalist and separatist sentiments among Tibetans.
"I am very concerned that this situation if allowed to go on may become explosive with catastrophic consequences for the Tibetans in Ngaba," he said in a written statement.
"In view of this I urge both the monks and the lay Tibetans of the area not to do anything that might be used as a pretext by the local authorities to massively crack down on them. I also strongly urge the international community, the governments around the world, and the international non-governmental organizations, to persuade the Chinese leadership to exercise restraint in handling this situation. "
He said the Chinese have used force to control the area since taking over what was an independent Tibet in 1950. This has "only deepened the grievances and resentment" of Tibetans, he said.
"I, therefore, appeal to the Chinese leadership to adopt a realistic approach and to address the genuine grievances of the Tibetans with courage and wisdom and to restrain from using force in handling this situation."
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