The report in the English-language China Daily, which attributed the figure to health experts, was a rare acknowledgement of the role played by death row prisoners in the country's transplant industry.
Executed inmates "are definitely not a proper source for organ transplants", the paper quoted Vice Minister of Health Huang Jiefu as saying.
In order to curb the country's "long-time dependence" on using organs from executed prisoners, the Red Cross Society of China on Tuesday launched a national organ donation system, the paper said.
The new system will aim to end the widespread illegal trafficking of organs that sees patients with money skip ahead of those on the waiting list who are perhaps more in need, the report said.
China executes more prisoners than any other country in the world, according to London-based Amnesty International but the actual number of those put to death is considered a state secret by the government in Beijing.
Following accusations that organs were being harvested from executed prisoners without consent, China enacted transplant regulations in 2007.
The rules ban organ trafficking as well as "transplant tourism" by high-paying foreign patients, and stipulate that executed prisoners can only donate organs to relatives.
But such regulations have not curbed the long-standing practices, the China Daily said.
"Some just ignore legal procedures regarding organ donations from executed prisoners and make a fat profit," the paper said.
According to official estimates, around 1.5 million Chinese need transplants each year but only 10,000 operations are carried out due to a severe shortage of donors, the state Xinhua news agency said.