Alibaba had made a strategic investment in AdChina, it said in a statement, without giving the amount. An Alibaba spokeswoman said financial details were not disclosed.
Alibaba, which listed on the NYSE last year, said the deal would allow the company to grow its online and mobile marketing "ecosystem".
The two companies will also develop online marketing services and data marketing products for businesses, media clients and third-party service providers, the statement said.
The company's consumer-to-consumer platform, Taobao, is estimated to hold more than 90 percent of the Chinese market with over 800 million product listings and around 500 million registered users.
Alibaba founder Jack Ma has shown ambitions beyond e-commerce, including entertainment and sports, purchasing a half-share in a Chinese football club.
Alibaba Pictures Group said this week it had signed Hong Kong filmmaker Wong Kar-wai for a movie project, its first since taking a controlling interest in a Hong Kong-listed company and changing its name.
Alibaba closed down 0.84 percent at $100.77 on Tuesday in US trading.