Chinese President Xi Jinping is visiting Macau to mark the 15th anniversary of the former Portuguese colony's return to China.
He urged people in the territory to respect the "one-China" principle.
Like neighbouring Hong Kong, Macau is a special autonomous region and has experienced protests by pro-democracy activists this year.
Correspondents say officials in Beijing do not want to the territories to become hotbeds of dissent.
"We must both adhere to the 'one China' principle and respect the difference of the two systems," Mr Xi said at the inauguration of Macau's Chief Executive Fernando Chui.
"This is the only way leading to sound and steady progress," Mr Xi added. "Otherwise a misguided approach from the beginning, just like putting one's left foot into the right shoe, would lead us nowhere."
Six months ago, demonstrators in Macau took to the streets to demand greater democracy. Mr Chui was the only nominee for the chief executive position, and was elected by a 400-person panel.
Gambling problemDuring his speech on Saturday, Mr Xi also referred to Macau's struggling economy.
It is the world's biggest gambling centre, but has seen casino revenues fall about 20% over the past year.
Mr Xi said the territory should reduce its dependence on one sector.
"It is important for Macau to adopt a global, nationwide, future-oriented and long-term perspective," Mr Xi said. "Focus on building a global tourism and leisure centre... promote the Macanese economy's appropriate diversification and sustainable development."
Macau's gambling industry has been in decline for several years.
Analysts say the recent pro-democracy protests in Hong Kong - a short ferry ride away - may have led to further losses in revenue by preventing tourists from visiting.
Activists in Hong Kong wanted Beijing to allow fully free elections for the territory's next leader in 2017. China says everyone can vote but a pro-Beijing committee will screen candidates.
The main pro-democracy protest camp was cleared earlier this month.
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