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The launch was the latest sign of deepening ties between Beijing and La Paz.
Bolivian President Juan Evo Morales Ayma was present during the launch, marking the first time a foreign head of state has witnessed a satellite launch in China.
The satellite will improve internet access and communications in remote rural areas, Morales said.
The satellite was produced by China Aerospace Science and Technology Corporation (CASC) with a designed longevity of 15 years.
It is Bolivia’s first communications satellite and has cost $300 million.
The satellite has been 85 per cent financed by a loan from the Chinese Development Bank. Bolivian citizens watched live broadcast of the launch through a national broadcast.
The satellite is named Tupac Katari in homage to an 18th century indigenous hero who fought Bolivia’s Spanish colonizers.
The satellite is expected to be operational in March 2014.
Chinese President Xi Jinping sent a message of congratulations to President Morales, saying the successful development and launch of the satellite represents the latest achievements and level of cooperation between China and Bolivia in the field of science and technology.
“The satellite will play an important role for Bolivia to improve its broadcasting, education and medical services. It will make important contributions to promote cooperation between China and Latin American countries,” Xi said.
Xi said he hopes for more space collaboration which will promote friendly relations between the resource rich Andean nation and commodity hungry China.
The increasing Chinese role marks a shift in Bolivia, one of the poorest countries in Latin America, which for decades relied on US aid.
With inputs from Agencies