Activists in Guizhou province tried to hand out information about the demonstrations over the weekend, but police told them this was an "unusual period" and gave them 3,000 yuan ($450) to stop, Chen Xi told AFP.
The police paid the money to compensate for losses incurred from the printing costs, and when the activists tried to distribute more information in Guiyang city on Monday, police again barred them from doing so, Chen said.
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"We do this (hand out leaflets) all the time but the police believe it's an unusual time right now -- they don't want to let Chinese people know about the situation in North Africa," he said.
"Most of the time, they tolerate us, but this information they cannot tolerate."
Police in Guiyang said they were unaware of the situation when contacted by AFP on Wednesday.
The protests in Egypt and Tunisia have made headlines around the world.
In Tunisia, more than 230 people have died in a popular uprising that led to the ouster last month of leader Zine El Abidine Ben Ali.
Egypt is still in the throes of a revolt against President Hosni Mubarak that has left him clinging to power in the Arab world's most populous nation.
In China, online discussion about the protests has been muffled in a sign that the unrest is worrying Beijing, which censors content seen as a potential challenge to the legitimacy of the ruling Communist Party.
A search under the word "Egypt" on the microblog of popular web portal sina.com on Wednesday yielded a message saying the search result cannot be shown "based on the relevant laws, regulations and policies".
State-run newspapers and television are reporting on the events in Egypt and Tunisia, but readers are not allowed to post comments at the bottom of online news stories on Egypt. On web portal netease.com, a message says the comment section has been closed.
"They're not confident. They have controlled China for 62 years with a one-party dictatorship, and they are still dealing with 1.3 billion people through the barrel of a gun," Chen said.
"The Chinese people are aware of this hard-line rule. So authorities are scared this information will spread to China."
