A quantum photon can "neither be separated nor duplicated. It is hence impossible to wiretap, intercept or crack the information transmitted through it", Chinese state-owned news agency Xinhua said.
The satellite, known formally as Quantum Experiments at Space Scale (QUESS), will also provide insights into a quantum physics phenomenon known as quantum entanglements by beaming entangled photons to two earth stations, 1,200 kilometres apart.
QUESS was launched from the Jiuquan satellite launch centre in the north west Gobi desert, aboard a Long March-2D rocket. The 600 kilogram satellite will circle the earth every 90 minutes once it reaches sun-synchronous orbit at an altitude of 500 milometers, Xinhua said.
The satellite has been nicknamed Micius after a Chinese philosopher and scientist who conducted the first optical experiments in 5BC, the news site said.
