China has installed a radar with potential military functions in a disputed area of the East China Sea, Japanese media said Sunday, in the latest flare-up of tensions between the two countries.

The Japanese foreign ministry said China had placed a surface search radar and surveillance camera on one of its structures in a gasfield which is claimed by both countries, the Nikkei business daily reported.

The ministry on Friday complained to Beijing through diplomatic channels, the newspaper reported.

The paper said it was the first radar unit known to have been installed on any of the Chinese structures in the area, which is believed to be rich in oil and gas deposits.

Tokyo is analysing the radar's capability and is concerned that Beijing could be intending to strengthen its military power in the East China Sea.

The foreign ministry did not immediately respond to requests for comment on the report.

Japan and China agreed in 2008 to jointly develop the undersea reserves in the disputed area, with a ban on unilateral drilling.

But negotiations stalled and Tokyo suspects China has some drilling rigs in operation near its de facto maritime border with Japan.

On Sunday Tokyo separately protested to Beijing after two Chinese ships entered Japanese waters near disputed islands also in the East China Sea.

Japan's government said the two Chinese coastguard ships were sailing some 20 kilometres (12 miles) west of one of the Senkaku islands, known as the Diaoyus in Chinese, on Sunday morning.

"The intrusion violates our country's sovereignty and is completely unacceptable," Japanese vice foreign minister Shinsuke Sugiyama told Cheng Yonghua, Beijing's ambassador to Tokyo, by phone, according to a government statement.

The two vessels left the waters later in the day, the Japanese coastguard said.

On Saturday Japanese maritime officials reported seeing some 230 Chinese fishing vessels and seven coastguard ships, including four apparently carrying weapons, sailing into the same waters.