Britain suspended its extradition agreement with Hong Kong and extended an arms embargo to the city-state in response to a new security law Beijing imposed on the former British territory.
Foreign Secretary Dominic Raab told MPs that the measures are "reasonable and proportionate".
"We will protect our vital interests," Raab added. "We will stand up for our values and we will hold China to its international obligations."
Britain also followed Australia, Canada and the US in extending an arms embargo against China — in place since 1989 — to Hong Kong.
"The extension of this embargo means there will be no exports from the UK to Hong Kong, of potentially lethal weapons, their components or ammunition," Raab explained.
"It will also mean a ban on the export of any equipment not already banned, which might be used for internal repression, such as shackles, intercept equipment, firearms and smoke grenades."
Raab said that the UK "wants a positive relationship with China" that it is "also clear-sighted about the challenges that lie ahead".
He described China's decision to bypass Hong Kong's legislature to impose a tough new national security law as a "clear and serious violation of the UK-China Joint Declaration" signed between the two countries before London handed the territory back to Beijing in 1997.
Britain has already offered residency rights to three million Hong Kongers in response to China's new security law, which reduces the city's autonomy and could see protesters and critics of the Chinese government tried in courts on the mainland.
Critics see the new law as a further erosion of the rule of law and freedoms that Hong Kong was promised when it reverted to Chinese rule.
Britain's top diplomat also accused Beijing of "gross human rights abuses" against its Uighur Muslim population in the western province of Xinjiang.
China's ambassador to Britain had warned in a BBC interview on Sunday that China would deliver a "resolute response" to any move by Britain to sanction officials over the alleged rights abuses.
Liu Xiaoming, the Chinese ambassador, denied there were concentration camps in Xinjiang during an interview with the BBC's Andrew Marr and insisted there are "no so-called restriction of the population." When confronted with drone footage that appeared to show Uighurs being blindfolded and led onto trains, Liu claimed there are many "fake accusations" against China.
Beijing was ready to respond in kind should Britain impose sanctions on Chinese officials, Liu added.
"If the UK goes that far to impose sanctions on any individuals in China, China will certainly make a resolute response to it," he said. "You have seen what happened between China (and) the United States … I do not want to see this tit-for-tat between China-US happen in China-UK relations."
Liu also said Britain "should have its own independent foreign policy, rather than dance to the tune of the Americans like what happened to Huawei."
The criticism echoed comments this week by a Chinese government spokeswoman who accused Britain of colluding with Washington to hurt Huawei and "discriminate, suppress and exclude Chinese companies."