A visa scheme to allow Hong Kong residents to come to the UK opens on Sunday, with some 300,000 people expected to apply.
The visa, which is open to holders of a British National (Overseas) passport and their immediate dependents, will offer a fast track to UK citizenship.
But the Chinese foreign ministry said it would no longer recognise the BNO passport as a travel document, reports BBC.
The UK launched the new visa after China imposed a new security law.
Those who apply and secure the visa will be able to apply for settlement after five years and then British citizenship after a further 12 months.
Beijing has previously warned the UK not to meddle in domestic issues.
Prime Minister Boris Johnson said the move honoured the UK's "profound ties of history and friendship" with the ex-British colony.
About 7,000 people from Hong Kong have already been allowed to settle in the UK since July, the Home Office said.
Although there are 2.9 million citizens eligible to move to the UK, with a further estimated 2.3 million dependents, the government expects about 300,000 people to take up the offer in the first five years.
The 7,000 who have already arrived were allowed to settle before the scheme began by being granted Leave Outside the Rules, which gives the government discretion over immigration rules on compassionate grounds.
Mr Johnson said: "I am immensely proud that we have brought in this new route for Hong Kong BNOs to live, work and make their home in our country.
"In doing so we have honoured our profound ties of history and friendship with the people of Hong Kong, and we have stood up for freedom and autonomy - values both the UK and Hong Kong hold dear."
Chinese Ministry of Foreign Affairs spokesman Zhao Lijian called the scheme a violation of China's sovereignty and gross interference in Hong Kong and China's internal affairs, the country's state-affiliated news website The Paper reported.
"The British side disregarded the fact that Hong Kong returned to China 24 years ago," he said.
China will no longer recognise the BNO passport from Sunday. It is not yet clear what this move will mean.
Hong Kongers use their own Hong Kong passport or ID card to leave the city. To enter mainland China, they need to use their Home Return Permit, issued by Chinese immigration, unless they use a full foreign passport and apply for a visa to enter as a foreigner.
The only time they might use a BNO is upon arrival into the UK, or another country that recognises the document.
Those eligible for the new visa can apply online and will need to book an appointment to attend a visa application centre.
And from 23 February, BNO status holders who hold an eligible biometric passport will be able to use an app to complete their application from home.
The visa fee to stay for five years will be £250 per person - or £180 for a 30-month stay - and there is an immigration health surcharge of up to £624-a-year.
Nathan Law, a pro-democracy campaigner who fled Hong Kong and now lives in exile in the UK, welcomed the announcement.
"It's a commitment to the historical agreement to Hong Kong and I think it's important that we offer safe exit for the people who are facing political suppression in Hong Kong," he told the BBC.