In response, a Chinese diplomat made a comment which some interpreted as a threat to behead Takaichi.
But what began as a war of words has now gone beyond barbs: Both countries' foreign ministries have since lodged serious protests with each other. Japan has also warned its citizens to stay safe in China, while China urged its citizens to avoid travelling to Japan.
Some Chinese airlines have even offered refunds for flights to Japan. The release of two popular Japanese films in China have also been postponed.
The spat touches on the historical animosity between China and Japan, as well as longstanding "strategic ambiguity" on the sovereignty of self-governed Taiwan.
Here's what you need to know about it:
What happened? A timeline
The current tensions were sparked at a parliamentary meeting in Japan on 7 November, when an opposition lawmaker asked Takaichi what circumstances surrounding Taiwan would count as a survival-threatening situation for Japan.
"If there are battleships and the use of force, no matter how you think about it, it could constitute a survival-threatening situation," Takaichi responded.
A "survival-threatening situation" is a legal term under Japan's 2015 security law, referring to when an armed attack on its allies poses an existential threat to Japan. In such a situation, Japan's self-defence forces can be activated to respond to the threat.
Takaichi's remarks drew immediate ire from Beijing, with China's foreign ministry describing them as "egregious".
The following day, Xue Jian, China's consul general in the Japanese city of Osaka, reshared a news article about Takaichi's parliamentary remarks on X. But he also added his own comment that "the dirty head that sticks itself in must be cut off".
While the intent of Xue's remarks "may not be clear", they were "highly inappropriate", said Japan's chief cabinet secretary Minoru Kihara.
Tokyo lodged protests with China over Xue's remarks, while Beijing lodged its own with Japan over Takaichi's.
Xue's post has since been taken down - but the dust from the barbed exchanges hasn't settled yet.
Takaichi has declined to retract her remarks, which she defended as "consistent with the government's traditional position". She did note, however, that she would be careful about commenting on specific scenarios from now on.
Meanwhile, China has turned up the heat on Japan, summoning the Japanese ambassador and repeatedly demanding that Takaichi takes back her words.
On social media, China's foreign ministry warned Japan to "stop playing with fire" and added that it would be an "act of aggression" if Japan "dares to meddles in the cross-Strait situation".
China has urged its citizens "to avoid travelling to Japan in the near future" over what it called "blatantly provocative remarks regarding Taiwan".
This could deal a blow to Japan's tourism industry, which is supported by millions of Chinese visitors every year. Japan's tourism and retail stocks have slid amid the row.
For their part, Japanese authorities say their position of supporting "peaceful resolution" to issues on Taiwan "has not changed".
They have also urged China to "take appropriate action" over Xue's social media post.
This week, the releases of at least two Japanese movies in China were also postponed, with distributors citing "sentiments of the domestic audience", Chinese state media reported.
Chinese state media CCTV added that cinema ticket sales for the hit Japanese animation Demon Slayer: Infinity Castle had also fallen recently.
A long history of animosity
There is longstanding animosity between the two countries, which can be traced back to a series of armed conflicts in the 1800s and Japan's brutal military campaign in China during World War Two.
This was brought up by a Chinese defence official last week, who said Japan would face "crushing defeat" by the Chinese military if it "failed to draw lessons from history and dared to take reckless risks".
Historical grievances may have long been sore spots in bilateral relations, but the recent ascension of Takaichi, a protégé of the late former prime minister Shinzo Abe, suggests more tensions may lie ahead.
The conservative leader is pursuing closer ties with the US and has pledged to increase Japan's defence spending - raising some alarm in Beijing.
Getty ImagesThe US and Japan have been deliberately ambiguous on how they would respond, should China invade Taiwan
Takaichi is also famously hawkish on China and a longtime supporter of Taiwan.
She had previously said that a blockade of the island could threaten Japan, and that Japan could mobilise its troops to stop a Chinese invasion.
China is especially touchy about Taiwan, the self-governed island that Beijing claims as part of its territory. China has not ruled out the use of force to take Taiwan - a posture that has unsettled Taipei and its allies in the region.
Earlier this month, Beijing accused Takaichi of violating the one-China principle, after she posted photos of herself meeting a senior Taiwanese official on the sidelines of the Apec summit in South Korea.
Why Takaichi's recent comments caused such a stir
The Japanese prime minister's recent comments mark a departure from the equivocal position that the country has traditionally adopted on the status of Taiwan.
This is in line with the policy of "strategic ambiguity" that the US has long maintained: remaining vague about what it would do to defend Taiwan in the event of a Chinese invasion.
For decades, this ambiguity has kept China guessing - a form of deterrence - while leaving room for economic ties to flourish.
The Japanese government's official stance is that it hopes the Taiwan issue can be resolved peacefully through dialogue - and Japanese officials have typically avoided mentioning Taiwan in public discussions about security.
On the occasions where they have, they have been met with sharp rebuke from Beijing.
In 2021, when then deputy prime minister Taro Aso said that Japan would need to defend Taiwan alongside the US in the event of an invasion, Beijing condemned his remarks and told Japan to "correct its mistakes".
In this more recent flare-up, China's foreign ministry said that Takaichi's remarks were "a gross interference in China's internal affairs".
"Taiwan is China's Taiwan," ministry spokesperson Lin Jian told a press briefing on Monday, adding that China would not "tolerate any foreign interference" on the matter.
"What signal is the Japanese leader trying to send to 'Taiwan independence' separatist forces?" he added. "Is Japan up to challenge China's core interests and stop its reunification?"
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