Searches were carried out at two addresses, one of which is on the island of Andoya in the Arctic Circle and which hosts both a rocket launch pad and a weapons testing site.
"The operation is based on suspicions that a company registered in Norway is being used as a cover for an attempt by a Chinese state actor to establish a receiving station to download data from satellites in polar orbit," Thomas Blom, police prosecutor at PST, told AFP in a statement.
The data in question could "harm Norway's fundamental interests if it came into the hands of a foreign state", Blom added.
No further details were disclosed about the Chinese national, who is suspected of having attempted to engage in "aggravated intelligence activities targeting state secrets".
Other individuals are also suspected in the case and a device that could receive satellite data had been seized, according to PST.
Contacted by AFP, the Chinese embassy in Norway did not immediately respond.
Norwegian intelligence services regularly single out China and Russia as the main risks to Norway when it comes to espionage.
In its latest threat assessment report, PST said that the two countries had shown interest in purchasing land near critical infrastructure or military installations.