What's more, Microsoft chairman Bill Gates hinted that China will be privy to all, not just part, of the source code its government wished to inspect.
The Chinese government and military have previously stated their preference for the rival Linux operating system because its source code is made publicly available.
Without knowing the inner working of an operating system--a fact revealed by its source code--governments like China fears that back doors may be installed to leak sensitive information.
The China Information Technology Security Certification Center (CNITSEC) signed an agreement with Microsoft to participate in Microsoft's Government Security Program (GSP).
Dr. Wu ShiZhong, director of the CNITSEC reaffirmed that information technology security was a key issue for the government.
"Microsoft's GSP provides us with the controlled access to source code and technical information in an appropriate way. It also establishes cooperation between China and Microsoft. Microsoft has taken a step forward to let us understand its product security," he said.
Microsoft chairman Bill Gates, who is visiting China, said: "As part of Microsoft's commitment to creating a trustworthy computing environment, we are pleased to have signed this agreement. As a government customer and trusted partner, we are committed to providing the Chinese government with information that will help them deploy and maintain secure computing infrastructures. We see this agreement as a significant step forward in Microsoft's relations with the Chinese government."
In January, Microsoft announced the GSP plan, under which it will share the source code underlying its Windows operating system with several international governments, a move designed to address concerns about the security of the OS.
Microsoft said last month, it announced GSP agreements with Russia, NATO and the United Kingdom. The firm is in discussions with more than 30 countries, territories and organizations regarding their interest in the program.
Chinese President Jiang Zemin also spoke with Bill Gates in Beijing. Jiang said China welcomed Microsoft and other well-known global companies to invest in China and seek common growth.
Gates briefed Jiang about Microsoft's investment in China and gave an update on how it was sharing the source code of computer software. No details were given on what software would be part of the information deal.
In order to develop its own software industry and maintain security, China has produced its own version of Linux, Red Flag Linux, as well as its own office productivity suite, RedOffice, which go head-to-head with Microsoft's own Windows and Office packages.