Another senior Shanghai official has been implicated in a major corruption scandal, a city spokesman said.
The scandal has already led to the sacking of the financial hub's top politician, Chen Liangyu.
The investigation is being viewed as an attempt by President Hu Jintao to strengthen his position within the ruling Communist Party.
Sun Luyi is the latest senior party official to be investigated in Shanghai's widening corruption scandal.
The Party leadership in Beijing is wasting little time in stamping its authority on China's richest city.
CORRUPT COMRADES
Chen Liangyu, the Communist Party boss in Shanghai, was arrested on Monday on charges of misappropriating a large part of the city's pension fund and investing it in risky property ventures.
Sun Luyi, vice secretary-general of the Shanghai municipal committee, is accused of a severe breach of party discipline as part of the same inquiry.
Stronghold
Beijing has already sent over 100 investigators to Shanghai.
A state-run newspaper reported on Thursday that a separate team of investigators had examined the city's property rules and found them wanting.
Officials in Shanghai, including Mr Chen, are believed to have resisted Beijing's efforts to ease a bubble in the property market as part of efforts to cool the country's over-heating economy.
The sackings and the deepening investigation are widely viewed as an attempt by President Hu Jintao to weaken the political stronghold of his predecessor, Jiang Zemin, a former Shanghai mayor.
President Hu is taking on the so-called Shanghai faction in an attempt to strengthen his own position before an important party congress due to take place next year.
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