The Xinhua News Agency says the panda preserve will incorporate parts of three western provinces to provide an unbroken range for the endangered animals in which they can meet and mate in the interests of enriching their gene pool.
Xinhua said about 170,000 people will have to be moved elsewhere to make way for the 27,134-square kilometer (10,476-square mile) preserve.
Giant pandas are China's unofficial national mascot and live mainly in the mountains of Sichuan, with some in neighboring Gansu and Shaanxi provinces.