More than 156 million tonnes of potassium chloride was found during a preliminary exploration in the western part of the Qaidam Basin, according to the MLR.
More deposits are expected to be discovered, said the ministry.
The MLR called the recovery a "milestone" as China currently imports 70 percent of its potassium.
About 450 million mu (30 million hectares) of farmland in China uses potassium and about 6 million tonnes of potassium fertilizer is imported every year.
Canada, Russia and Belarus own 60 percent of the world's potassium fertilizer resources and production.