The increase compares to a 7.5 percent increase last year.
The announcement was made by spokesman Li Zhaoxing at the annual session of China's top political advisory body, which opened Thursday, the state-run Xinhua news agency reported.
Li said this year's defense budget was 67.6 billion yuan (about $10.3 billion) more than last year and would account for 6 percent of the total budget.
"The government has always tried to limit military spending and it has set the defense spending at a reasonable level to ensure the balance between national defense and economic development," Li said, adding the defense budget is transparent and defensive in nature.
The former Chinese foreign minister said much of the increases would go to finance improving armament, military training, and the living standards of the servicemen.
"China is committed to peaceful development and a national defense policy that is defensive in nature," which would not pose a threat to any country, he said.
The Wall Street Journal reported the 2011 increase, while higher than last year, is far lower than in earlier years. The report said other countries in the region, concerned about China's spending, are strengthening their armies, which could result in an arms race on the continent.