China has followed Japan's lead in the capsule hotel market, amid an explosion of leisure travel in the world's most populous country.
The first capsule hotel in Shanghai opened at the weekend, less than a month before the Spring Festival holiday, when hundreds of millions of people crisscross the country to celebrate Lunar New Year with their families.
The hotel has 68 cabinet-sized rooms imported from Japan -- where capsule hotels originated -- each equipped with a power point, clock, light, television and wireless Internet, the China Daily said.
The men-only hotel charges 68 yuan ($10) for 10 hours or 88 yuan for 24 hours, the report said, citing Ta Zan, who owns the hotel and used to work for capsule hotels in Japan.
"This is a huge bargain compared with other budget hotels in Shanghai," Ta, 33, was quoted saying.
The report said the budget hotel near the Shanghai Railway Station was the first capsule hotel in China to be built to international standards.
No one at the hotel could immediately be contacted for comment.
China's booming tourism industry was expected to host 2.1 billion domestic and international travellers in 2010, an increase of 12 percent over the previous year, according to previous industry estimates.