Many of the employees are simply performing keyword searches to monitor the tens of millions of messages being posted daily on popular social media and microblogging sites, the Beijing News said.
The exact number of people employed to trawl through the Internet in a bid to prevent social unrest and limit criticism of the ruling Community party has long been the subject of speculation.
The "web police" are employed by the government's propaganda arm, as well as by commercial sites, the Beijing News said.
China's censorship authorities tightly control online content for fear of political or social unrest that could challenge the Communist party's grip on power.
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Authorities in recent years banned the popular social media sites Facebook and Twitter, which were instrumental in the wave of uprisings that swept the Middle East and North Africa from late 2010 in what became known as the Arab Spring.
Last year authorities blocked The New York Times after it cited financial records showing relatives of former Chinese Premier Wen Jiabao had controlled assets worth at least USD 2.7 billion -- a report China branded a smear.
They have detained hundreds of people for spreading "rumours" online, and warned high-profile bloggers with millions of followers to post more positive comments.
The Supreme Court said this month that Internet users could face three years in jail if "slanderous" information spread online is viewed more than 5,000 times or forwarded more than 500 times.
China has more than 500 million Internet users, making it the world's largest online population.