Centered around a new, condensed structure of 84 military units, the reshuffle builds on Xi's years-long efforts to modernize the PLA with greater emphasis on new capabilities including cyberspace, electronic and information warfare.
As chairman of the Central Military Commission, Xi is also commander-in- chief of the armed forces.
"This has profound and significant meaning in building a world-class military," Xi told commanders of the new units at the PLA headquarters in Beijing, according to the Xinhua News Agency report.
All 84 new units are at the combined-corps level, which means commanders will hold the rank of major-general or rear-admiral, China Daily reported yesterday.
It added that unit members would likely be regrouped from existing forces given the military was still engaged in cutting its troops by 300,000, one of the wide-ranging military reforms introduced by Xi in late 2015.
Those reforms include establishing a joint operational command structure by 2020 and rejigging existing military regions, as well as streamlining troop numbers particularly in non-combat facing roles.
Reports have speculated that the country's second aircraft carrier - and its first built at home - will be launched on Sunday, the anniversary of the navy's founding.
Xi has also made rooting out deeply entrenched corruption in the military a top priority. Dozens of senior officers have been investigated and jailed.