A man attacked a car carrying the Japanese Ambassador in Beijing and ripped off the Japanese flag on the vehicle on Monday.
The Embassy issued a statement saying Ambassador Uichiro Niwa was unhurt in the incident.
It said two other vehicles forced his car to stop and a man got out, broke off the flag and made off with it.
But Japan's Foreign Ministry later said the flag was snatched after the ambassador's car became stuck in a traffic jam.
The Kyodo news agency said the embassy filed a strong protest with the Chinese Foreign Ministry. about the incident.
Tensions over disputed islands known as Diaoyu in China and Senkaku in Japan flared this month.
Anti-Japanese demonstrations have taken place in Chinese cities over the past two weeks.
In a symbolic gesture, the Japanese parliament on Friday passed two resolutions asserting Japan's sovereignty over both island chains.