China has approved a law allowing only the country's top court to approve death sentences, state media reports.
China has the highest death penalty rate in the world
The move follows a series of miscarriages of justice since lower courts were given the right to approve the death sentence in the 1980s.
China's official state news agency, Xinhua, said it was believed to be the most important reform of capital punishment in more than two decades.
China is accused of carrying out more executions than any other country.
In 2005, it carried out an estimated 1,770 executions and sentenced nearly 4,000 people to death, human rights group Amnesty International says.
The change in the law, approved by the country's top legislature, is due to come into effect on 1 January 2007, Xinhua reported.
It means that all death penalty sentences given by lower courts must be reviewed and ratified by the Supreme Court.
CHINA'S DEATH PENALTY
China is believed to execute more people than rest of the world combined
Non-violent crimes such as tax fraud and embezzlement carry death penalty
Other crimes include murder, rape, robbery and drug offences
China does not publish official figures on executions
Many cases are based on confessions and trials often take less than a day, observers say
But it is unclear whether this will involve a full appeal hearing or, as it is at present in lower courts, simply a review of the paperwork from the initial trial.
Jerome Cohen, a US expert on the Chinese legal system, called the move a "step in the right direction", which shows the country's top judiciary is increasingly concerned by the death penalty system.
But he said more fundamental reform of the death penalty legislation is needed to change the way such cases are tried and appealed.
China's chief justice Xiao Yang called it "an important procedural step in preventing wrongful convictions".
"It will also give the defendants in death sentence cases one more chance to have their opinions heard," Mr Xiao said in comments carried by state media.
Miscarriages of justice
The Supreme Court had responsibility for reviewing all death penalty cases until the early 1980s when provincial courts were given the authority to issue the death sentence.
Early this year, death penalty cases began to be heard in public as China came under pressure at home and abroad over the rising number of miscarriages of justice.
Two cases of wrongful convictions got widespread coverage in the Chinese media last year.
A butcher executed for murder in 1989 was proved innocent when his alleged victim was found alive; while a man was freed after 11 years in jail when his wife, whom he was accused of killing, was also found alive.
The authorities are hoping the decision will tighten up the current process, but it remains to be seen whether it has any impact on the number of people being executed in China, the BBC's Dan Griffiths in Beijing says.
Capital punishment has a long history in China, and there is no indication the country is ready to give up the death penalty, our correspondent adds.