Images posted on social media networks showed extensive damage after the tornado struck mid-afternoon in Dongming county, 530 kilometres (330 miles) south of Beijing in Shandong province, the local emergency management bureau said in a statement.
"The disaster left one person dead. A total of 79 people also suffered varying degrees of injury," it said.
Rescue, relief and clean-up operations were underway.
Chinese media showed images of a huge grey tornado moving at high speed and carrying debris into the sky.
Videos posted on Chinese social media network Weibo showed roads strewn with pieces of wood and stones, shop signs stripped, cars with shattered windows and uprooted trees.
China has endured extreme weather conditions in recent months, from torrential rainfall to searing heatwaves.
It is the leading emitter of greenhouse gases, which scientists say drive climate change and make extreme weather events more frequent and intense.
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