The centre in the southern province of Guizhou, part of a USD 1 billion investment there, will be operated with a local data management company, the company said.
Apple said in a statement that the new centre would keep "strong data privacy and security protections in place," adding that no back doors would be created in its systems, the New York Times reported.
The data centre in Guian New Area plans to offer iCloud services on the Chinese mainland.
The new centre will run entirely on renewable energy and will become a pilot green data centre project in southern China.
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Lisa Jackson, Apple's vice president of Environment, Policy and Social Initiatives, said Guizhou's efforts in sustainable development had been impressive and the province was one of the most promising places in China to set up date centres.
The rules also call for security reviews and for users of messaging apps to register their real identities. The regulations are part of a wider Chinese industrial policy put into place to build local capabilities.
China generates 25 per cent of all Apple's profits and is the company's second-largest market.