Two top officials are sacked after the spike was revealed, resulting from a new diagnostic method.
Some 242 deaths from the new coronavirus were recorded in the Chinese province of Hubei on Wednesday - the deadliest day of the outbreak.
There was also a huge increase in the number of cases, with 14,840 people diagnosed with the virus.
Hubei has started using a broader definition to diagnose people - which accounts for most of the rise in cases.
China sacked two top officials in Hubei province hours after the new figures were revealed.
Until Wednesday's increases, the number of people diagnosed with Covid-19 in Hubei - where the outbreak emerged - was stabilising.
But the new cases and deaths in the province have pushed the national death toll above 1,350 - with almost 60,000 infections in total.
China has been accused of suppressing the full extent of the outbreak in the past, says the BBC's Nick Beake in Hong Kong.
Professor David Heymann, Professor of Infectious Disease Epidemiology from the London School of Hygiene and Tropical Medicine, said: "What has happened in China is that they have changed the definition of what the disease really is - now they are taking people who have lesser symptoms.
"The deaths are quite worrisome, there are an increased number of deaths reported, but if you look overall at the total number of deaths and the total number of cases, the fatality ratio is about the same as it has been - but it is still high, as high as the death rate in influenza."
Only Hubei province - which accounts for more than 80% of overall Chinese infections - is using the new definition to diagnose new cases.
Just about everyone who's been following China's official coronavirus numbers has been able to see that they have been incomplete. Government officials know this too. There's no way they've accounted for everybody infected. How could they?
But at least we had what appeared to be a trend. We could observe the pattern to try and estimate the trajectory of outbreak.
Now that's gone too.
You can understand why it has been decided that people who have virus symptoms, plus a CT scan showing chest infection, are now being counted in the "definitely infected" column.
However, this has thrown the trend mapping into chaos.
Over the past 24 hours, in Hubei alone, nearly 15,000 people were moved into the infected column. This would have sent shockwaves around the world, but actually, if you consider Wednesday's cases by the old definition, the rate could well mean another day of decline: a completely different picture.
So now, we're scratching our heads: do we start looking at the pattern all over again from Thursday onwards?
This has also left many wondering what the real death rate must have been over recent weeks and the extent to which we should be treating the overall figures seriously anyway.
Meanwhile, the Communist Party secretary in Hubei, Jiang Chaoliang, has been replaced by the Shanghai party chief, Ying Yong, according to state media. The party chief of the capital city, Wuhan, has also been relieved of his duties.
It is the first major change of Hubei party officials since the outbreak began.
Earlier this week, a number of health officials were "removed" from their jobs.
What is the new diagnosis method?
The province - which accounts for more than 80% of overall Chinese infections - now includes "clinically diagnosed cases" in the number of confirmed cases.
This means it includes those showing symptoms, and having a CT scan showing an infected lung, rather than relying only on the standard nucleic acid tests.
Of the 242 new deaths in Wuhan, 135 are such "clinically diagnosed" cases.
That means, even without the new definition, the number of deaths in Hubei on Wednesday was 107 - a new high for the province.
The province's 14,840 new infections include 13,332 clinically diagnosed cases.
Overall, the province now has 48,206 confirmed infections.
What is the latest with the cruise ships?
A cruise ship carrying more than 2,000 people has docked in Cambodia - after it was turned away by five ports over fears that some passengers might be infected with the virus.
The MS Westerdam arrived on Thursday morning after Japan, Taiwan, Guam, the Philippines and Thailand had all refused to accept the ship - despite having no sick patients on board.
Meanwhile, another 44 cases have been confirmed on the Diamond Princess, which is in quarantine in Yokohama, Japan.
The increase means 218 people of the 3,700 people on board the ship have caught the virus. Not everyone has been tested yet.
People with the virus are taken to hospitals on land to be treated, while those on board are largely confined to their cabins.
What does the WHO say?
The WHO said it was "way too early" to predict the end of the epidemic. "This outbreak could still go in any direction," the director-general warned.
The WHO has been able to track down the source of transmission in all but eight of the 441 cases of the virus outside China, its head of emergencies Michael Ryan said.
He added: "I think it's way too early to try to predict the beginning, the middle or the end of this epidemic right now."
On Tuesday top Chinese epidemiologist Zhong Nanshan said the epidemic should peak in China this month before subsiding.
Four possible vaccines were being funded for pre-clinical development, WHO Chief Scientist Soumya Swaminathan told reporters.
"I think we will find a vaccine," she said. "It will take some time. A vaccine cannot be made overnight."
In other developments:
- Australia has extended its ban on people coming from mainland China for another week, to 22 February from 15 February
- Hong Kong's most high-profile sports event, the Rugby Sevens, as well as the Singapore Sevens, are expected to be postponed
- China said it would stagger the return of children to school. Several provinces have closed schools until the end of February
- In Vietnam, which borders China, thousands of people in villages near the capital, Hanoi, have been put under quarantine after several cases of the virus were discovered. Vietnam has now confirmed at least 16 cases of Covid-19
- Russian police are searching for a woman who absconded from coronavirus quarantine by short-circuiting an electric lock. Alla Ilyina said on Instagram she had tested negative in three tests in St Petersburg and could not see why she should stay
- North Korea has doubled the quarantine period for those entering the country to 30 days as it takes emergency measures to prevent the spread of coronavirus (no cases have yet been detected)
- Officials are attempting to trace the contacts of the latest person to be diagnosed with coronavirus in the UK. The woman, who flew into London Heathrow from China a few days ago, is the ninth case to be confirmed.