The World Intellectual Property Organization, a U.N. intellectual property agency headquartered in Geneva, said the United States came in second with 503,582 applications, and Japan third with 342,610 applications last year.
The agency in its World Intellectual Property Indicators 2012 said it was the first time global patent filings had passed the 2 million mark, adding the filings would benefit the global economy.
"Sustained growth in IP filings indicates that companies continue to innovate despite weak economic conditions," said agency Director General Francis Gurry. "This is good news, as it lays the foundation for the world economy to generate growth and prosperity in the future."
The agency monitors global registration of patents, copyright, trademarks, designs and utility models, or UMs which are instruments to protect inventions for a limited period of time.
The report said China is already the world's largest processor of Ums.
With its record registration, the report said China's State Intellectual Property Office has become the world's largest patent office, surpassing the United States Patent and Trademark Office and the Japan Patent Office.
The report said prior to 2011, Germany, Japan and the United States had held the top spot for 100 years.
"Even though caution is required in directly comparing IP filing figures across countries, these trends nevertheless reflect how the geography of innovation has shifted," Gurry said in the report's foreword.
Patent filings across the world grew by 7.8 per cent in 2011, the second year in a row when growth exceeded 7 percent, the report said. It followed a 3.6 per cent decline in 2009 in the wake of the global financial crisis.
Patents for digital communication and renewable energy technologies represented the highest worldwide filing increases from 2006 to 2010.
However, the report said filings for pharmaceuticals have declined since 2007.
"Residents of Japan filed the largest number of applications relating to solar energy and fuel cell technologies, while residents of Germany and the U.S. accounted for the largest numbers of applications relating to geothermal and wind energy, respectively," the report said.