David Cameron has said China provides a "huge opportunity" for British business as he announced £1.4bn of trade agreements between the two countries.
After meeting Chinese Premier Wen Jiabao for talks, Mr Cameron hailed what he said was a "deeper dialogue".
But he said political and economic progress must go hand in hand as respect for human rights was "the best guarantor" of prosperity and stability.
Mr Wen urged co-operation and dialogue over the issue, not "finger-pointing".
During talks in Downing Street, the two leaders signed bilateral trade agreements worth £1.4bn and restated their desire to double the value of two-way trade between the countries by 2015.
UK companies are to get greater access to Chinese markets in architecture, civil engineering and research and development.
A ban on British poultry exports to China in place since a case of avian flu in 2007 is being lifted while more British pigs and pig meat are to be sold to China. Agreements on services and taxation have also been reached.
The two men also discussed improving cultural and educational relationships between China and the UK - building upon the large number of Chinese students at British universities - and global issues such as international security and climate change.
British exports have increased by 20% since Mr Cameron led a major business delegation to Beijing last November and No 10 hopes a new "signposting" agreement will enable British business to branch out beyond Beijing and Shanghai into fast-growing regional cities.
The UK and China must fulfil "mutual commitments on market access", Mr Cameron stressed, but he rejected any talk within Europe of resorting to increased barriers to slow the pace of Chinese imports as a way of narrowing its trade gap with China.
"Trade with China is a huge opportunity for the UK but we have a lot to offer China as well," he said. "Building on this trade and investment will mean jobs, growth and prosperity for all of us."
Mr Cameron rejected suggestions there was a "trade-off" between the UK's commercial interests in China and its willingness to speak out about human rights, saying no subject had been "off limits" in their talks.
While stressing that China and the UK were "different countries with different histories", Mr Cameron said the development of civil society and freedom of expression and respect for human rights "underpins stability and prosperity for us all".
"We applaud the economic transformation that has taken place in China... But, as I said in Beijing last November, we do believe the best guarantor of prosperity and stability is for economic and political progress to go in step together."
Wen Jiabao faced a small protest about China's human rights record during a visit to the MG car plant in Longbridge on Sunday.
Asked about the issue, he told a news conference in London: "On human rights, China and the UK should respect each other, respect the facts, treat each other as equals, engage in more co-operation than finger-pointing and resolve our differences through dialogue."
'Not much change'
The UK government was said to have been encouraged by the recent release from custody of artist Ai Weiwei and other dissidents but wanted the Chinese authorities to do more to allow freedom of expression.
One expert on Chinese politics told the BBC Beijing was tightening rather than loosening its grip over political expression and association.
"Human rights is an issue that you should raise as a matter of principle but realistically we are not going to see much change in China," Professor Steve Tsang, from the University of Nottingham, said. "They have not been delivering much in terms of human rights for a long time."
On the issue of trade links, Prof Tsang said the deals were welcome but did not break any new ground, and it remained to be seen whether access to China's regional heartlands would actually transpire.