The People's Liberation Army (PLA) is going to transform the existing 18 units into 25 or 30 divisions, Efe news quoted a report in the South China Morning Post on Wednesday.
The shakeup will probably lead to tens of thousands of layoffs and is expected to face resistance from the troops, according to sources close to the Chinese armed forces.
The measure is a part of the military reforms launched by the Chinese government in 2015 and that has already led to a 300,000 troop-cut.
Chinese President Xi Jinping, who is also chairman of the Central Military Commission (CMC), the most powerful organ of the PLA, has said the reform will be completed by 2020.
With this reform, China hopes to undo the Soviet structure of its army and make it lighter, faster and more functional, while simultaneously modernising its navy and squashing the endemic corruption in its military.
Ever since Xi's arrival in power in 2013, two top ranking officials of the CMC, a body that was virtually untouchable till a short while ago, Guo Boxiong and Xu Caihou, have been investigated for corruption.
While the former was sentenced to life imprisonment in July, the latter died of cancer in 2016 before the start of his trial.
The reforms come at a time when China is trying to flex its military muscle in the South China Sea, where it is locked in disputes with several neighbouring countries, and engaging frequently in conflicts in Africa and the Middle East, after decades of favouring a policy of non-interference.
