The 2004 outbreaks of highly pathogenic avian influenza H5N1 disease in China led to a great poultry loss and society attention. A survey of avian influenza viruses was conducted on tree sparrows (Passer montanus) collected in China in 2004. Four viruses were isolated from free-living tree sparrows. The results of the whole-genome analysis indicated that an H5N1 virus with a new genotype is circulating among tree sparrows. The hemagglutinin and neuraminidase genes of the new genotype were derived from Gs/Gd/96-like viruses and the nuclear protein gene descended from the 2001 genotype A H5N1 viruses, while the other inner genes originated from an unknown influenza virus. In experimental infection, all four viruses were highly pathogenic to chickens but not pathogenic to ducks or mice. The four tree sparrow viruses were different from the 2003 tree sparrow strain (genotype Z) in Hong Kong. The results suggested that H5N1 viruses might be distributed widely in tree sparrows.