Aircraft entering the area over the islands China calls Diaoyu would have to obey China's rules, China's Defense Ministry said, or face "emergency defensive measures," the BBC reported.
Japan, which refers to the islands as Senkaku, called the Chinese action an "escalation" and lodged a strong protest. In a statement, the Japanese foreign ministry charged the unilateral move "has the danger of leading to an unexpected situation."
Taiwan promised military action to protect its national security.
The zone claimed by China includes areas close to South Korea and Japan.
Chinese defense ministry spokesman Yang Yujun said creation of the zone was not aimed at any "specific country or target." He said regular flights in the areas by international airlines would not be affected.
China's People's Liberation Army said it conducted its first air patrol in the zone Saturday, China's official Xinhua News Service reported.
Xinhua said Chinese military expert Meng Xiangqing claimed declaration of the zone was in accord with accepted international practice. Countries had the right to set up such areas, he said, without getting permission from other countries as long as international law was not violated or other countries' sovereignty breached.