Onlookers, some who are said to have videoed the bizarre event, were said to be mesmerised as a towering city of sky scrapers appeared from the clouds.
First thousands reportedly saw a ghostly alien city floating over Foshan in the Guangdong province of China.
A few days later people in the province of Jiangxi, China, also reported seeing a similar cloud city.
Weather experts have explained the phenomena as natural mirage, an optical illusion called Fata Morgana.
Fata Morgana can be seen on land or sea and involves the optical distortion and inversion of distant objects such as boats, which can appears as skyscrapers because the images become stacked, when rays of light bend as they pass through air of different temperatures such as in a heat haze.
Chinese TV news reports said thousands of residents in two areas reported separately seeing a huge city form in the skies
But the mystery has sent conspiracy theorists into over drive.
There were previous reports of a similar sighting in China in 2011.
YouTube channel Paranormal Crucible said in a video report: "The footage captured by a local resident appears to show a huge city floating in the clouds.
"The apparition, which was witnessed by hundreds of shocked residents, only lasted a few minutes before completely disappearing."
The channel speculated it could be "the result of a project blue beam test."
Project Blue Beam is a prolific conspiracy theory which believes NASA will one day simulate an alien invasion of Earth or second coming of Christ through holograms.
Serge Monast, a conspiracist from Quebecois, first predicted in the 1980s it would happen by 1983, 1996 and then 2000.
One online poster noted: "Notice the group of buildings is repeated three times? If it isn’t someone making it on their computer, it seriously could be project blue beam."
The Paranormal Crucible video added: "But added: "Or a temporal vortex, a possible parallel universe material briefly into our own reality."
"It is also possible, considering China's technological achievements that a top secret holographic technology was tested over a heavily populated area in an effort to gauge the public reaction."