Wal-Mart has 22 outlets mainly in southern China, but none in Shanghai and now plans to expand there and in surrounding cities through its joint venture company, East China Wal-Mart Stores.
No details of the investment were provided.
Wal-Mart has also launched operations for its global procurement business in Shanghai.
Last year, Wal-Mart bought more than $10bn in goods from China directly and indirectly for sale in its stores worldwide. And expects to hit $12bn this year, Wal-Mart said.