The agreement follows a cybersecurity discussion between Australian prime minister Malcolm Turnbull and Chinese premier Ki Keqiang, Turnbull's office said in a statement.
Neither country will conduct or support cyber-enabled theft of IP, trade secrets or confidential business information with the intent of gaining a competitive advantage. This follows a similar agreement between the US and China, the statement said.
Both countries have also agreed to follow the advice given in reports by the UN Group of Government Experts on cybersecurity, including norms of responsible state behaviour that are laid out in the reports, it said.
On-going discussions between the two countries will help prevent incidents that could create problems between them, Turnbull's statement said.
Australia's Cyber Security Centre (ACSC) said last week that almost all Australian organisations were affected by cybersecurity attacks in 2015-2016, with 90% reporting an attempted or successful attempt.
A survey of 113 organisations found many malicious cyber threats, with spear phishing emails alone affecting Australian organisations up to hundreds of times a day, the ACSC said.
The Australian Cyber Security Growth Network (ACSGN) announced plans last week to triple the size of the country's cybersecurity industry, from around AU$2 billion (£3.5 billion) in revenue to AU$6 billion by 2026.
The ACSGN cybersecurity sector competitiveness plan (SCP) will "identify the challenges Australian organisations face when competing in local and international cyber security markets", it said.