The government-run China Internet Network Information Centre (CNNIC) reported the statistics, which said an 'online' user is defined as anyone who accessed the Internet over the last six months.
The report said up to 500 million people in China were accessing the internet using mobile phones by December. AAP reported China already had the most Web users worldwide, with the US coming in at number two.
Australia has the 28th highest number of Internet users, but has 82.3% penetration, compared with 42.3% in China.
China has what's known as the 'Great Firewall of China', otherwise known as the Golden Shield Project, which is a censorship and surveillance project conducted by the Ministry of Public Security (MPS) division of the government of China.
Censored websites include those linked to democracy movements, sites related to Tibet and the Dalai Lama, and pages that contain anything the Chinese authorities regard as obscenity or pornography.
Amnesty International notes that China “has the largest recorded number of imprisoned journalists and cyber-dissidents in the world.” The "offences" these prisoners are accused of include "communicating with groups abroad", "opposing the persecution of the Falun Gong", "signing online petitions" and "calling for reform and an end to corruption".