Huawei Technologies has signed an agreement with Russian telecom company MTS to develop next-generation 5G networks.
The deal was signed on Wednesday in Moscow, as Chinese President Xi Jinping and his Russian counterpart Vladimir Putin looked on.
US officials say Huawei is a security risk.
MTS said in a statement that it plans to work with Huawei on developing 5G technologies.
Mr Xi is on a state visit to Russia as the two countries grow increasingly close while each contends with friction with the US.
He will also attend a major investment conference in St Petersburg on Friday.
