Avian H3N2 influenza virus follows cross-host transmission and has spread among dogs in Asia since 2005. After 2015-2016, a new H3N2 subtype canine influenza epidemic occurred in dogs in North America and Asia. The disease prevalence was assessed by virological and serological surveillance in dogs in China. Herein, five H3N2 canine influenza virus (CIV) strains were isolated from 1185 Chinese canine respiratory disease samples in 2017-2018; these strains were on the evolutionary branch of the North American CIVs after 2016 and genetically far from the classical canine H3N2 strain discovered in China before 2016. Serological surveillance showed an HI antibody positive rate of 6.68%. H3N2 was prevalent in the coastal areas and northeastern regions of China. In 2018, it became the primary epidemic strain in the country. The QK01 strain of H3N2 showed high efficiency in transmission among dogs through respiratory droplets. Nevertheless, the virus only replicated in the upper respiratory tract and exhibited low pathogenicity in mice. Furthermore, highly efficient transmission by direct contact other than respiratory droplet transmission was found in a guinea pig model. The low-level replication in avian species other than ducks could not facilitate contact and airborne transmission in chickens. The current results indicated that a novel H3N2 virus has become a predominant epidemic strain in dogs in China since 2016 and acquired highly efficient transmissibility but could not be replicated in avian species. Thus, further monitoring is required for designing optimal immunoprophylactic tools for dogs and estimating the zoonotic risk of CIV in China.