"We believe the remains belonged to officers and soldiers aboard the warship," said Zhou Chunshui, who leads the exploration mission organised by the State Administration of Cultural Heritage.
The Zhiyuan Warship, with a 50-meter-long hull, is located about 10 nautical miles southwest of Dandong Port in Northeast China.
More than 100 pieces of ship parts and belongings of the seamen have also been found, Zhou said.
"We will study those relics and try to find out what lives at sea were like more than a century ago," state-run Xinhua news agency quoted him as saying.
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A total of 252 officers and soldiers were aboard. Only seven survived.
The four ships stated to be China's most sophisticated vessels at that time, bigger and better armed than the Japanese ones but slower and short of ammunition, Xinhua said.
Zhou said further investigation is needed to decide whether to lift the ship, whose main structure has remained intact, out of the water.