The Pak-China Joint Field Exercise Warrior-III was held at Bahdar Range in Attock district near capital Islamabad.
"Special Forces of Pakistan Army and PLA conducted a seven-week-long exercise with focus on counter-terrorism operations," the army said in a statement.
Sharif attended the closing ceremony along with a senior level Chinese military delegation under Gen Li Fayi.
He underscored that "the special relationship between Pakistan-China Armies which has transformed over time will grow to unprecedented heights".
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The joint exercise was part of a series of military exchange programmes between the two air forces, Chinese Air Force spokesperson Shen Jinke had said.
"Both, China and Pak, will continue to work towards total elimination of terrorism in all its forms and manifestations," he said on the occasion.
"He vowed to continue operations with the same momentum till the achievement of a terror free Pakistan," the statement said.
The Pakistan army is currently conducting Zarb-e-Azb, a major operation against militants in the former stronghold of the Taliban along the border with Afghanistan.