The security service said Christine Ching Kui Lee “established links” for the Chinese Communist Party with current and aspiring MPs.
She then gave donations to politicians, including Labour MP Barry Gardiner, who received more than £420,000 from her.
The Chinese Embassy in London accused MI5 of “smearing and intimidation” against the UK’s Chinese community.
According to the alert, Ms Lee claimed her involvement with Parliament had been to “represent the UK Chinese and increase diversity”.
But MI5 said that activity “had been undertaken in covert coordination with the United Front Work Department [of the CCP], with funding provided by foreign nationals located in China and Hong Kong”.
The security service said Ms Lee had “extensive engagement with individuals across the UK political spectrum”, including the now-disbanded All-Party Parliamentary Group called Chinese in Britain.
MI5 warned Ms Lee “may aspire to establish APPGs [parliamentary groups] to further the CCP’s agenda”.
Home Secretary Priti Patel said it was “deeply concerning” that someone “who has knowingly engaged in political interference activities on behalf of the Chinese Communist Party has targeted parliamentarians”.
But she said the UK has measures in place “to identify foreign interference”.