The incident prompted Japan's military to scramble eight F-15 fighter jets, the Defence Ministry said. Japanese officials later said the Chinese aircraft had left the area.
Sino-Japanese relations took a tumble in September after Japan bought the tiny islands, called Senkaku in Japan and Diaoyu in China, from a private Japanese owner.
"Despite our repeated warnings, Chinese government ships have entered out territorial waters for three days in an row," Japanese Chief Cabinet Secretary Osama Fujimura told reporters.
"It is extremely regrettable that, on top of that, an intrusion into our airspace has been committed in this way," he said, adding that Japan had formally protested through diplomatic channels.
A Defence Ministry spokesman said as far as he knew it was the first time this year that a Chinese plane had intruded into airspace near the islands, which are under Japan's control.
But China said the flight by the Chinese aircraft was "completely normal" and it called on Japan to stop entering the waters and airspace near the islets.
"The Diaoyu islands and affiliated islands are part of China's inherent territory. China's flight over the islands is completely normal," Chinese Foreign Ministry spokesman Hong Lei told a briefing in Beijing.
"The Chinese side calls on Japan to halt all entries into water and airspace around the islands."
"SACRED TERRITORY"
The incident comes just days before a Japanese election that is expected to return to power the conservative Liberal Democratic Party (LDP) with hawkish former prime minister Shinzo Abe at the helm.
Abe has vowed to take a stern stance in the dispute over the islands, which are near potentially huge maritime gas reserves, and has said that the ruling Democratic Party's mishandling of its diplomacy had emboldened China.
Abe has also promised to boost spending on defence including on the coastguard.
Smaller Asian countries such as the Philippines have also become increasingly worried about Beijing's growing military assertiveness and its claims to disputed islands in the South China Sea.
U.S. President Barack Obama urged Asian leaders during a visit to the region in November to rein in tension over territorial disputes.
Washington does not take a position on the sovereignty of the islands but says they are clearly covered by a 1960 security treaty obliging the United States to come to Japan's aid if attacked.
China says the islands are its "sacred territory" and says its claim predates Japan's.
Patrol ships from the two countries have for several months been shadowing each other in a standoff that has raised concern that a collision or other incident could escalate into a clash.
Japanese Prime Minister Yoshihiko Noda's nationalisation of the islands in September was intended to keep them out of the hands of a fiery nationalist politician, to head off a more damaging confrontation with China.
But the Japanese move triggered a wave of protests in China that shuttered Japanese factories and stores, disrupted trade and prompted China to strengthen its own claim to the disputed territory.
Japanese carmakers saw their sales in China slump in the weeks after the islands were sold
