The sentence comes as authorities clamp down on tools for circumventing the severe restrictions on China's internet, which prevents users from visiting a large number of sites, including Google, Twitter and Facebook.
VPNs allow internet users to reach censored content by filtering web traffic through servers around the world but China has cracked down on them.
Wu Xiangyang from the south Guangxi Zhuang autonomous region received the sentence along with a 500,000 yuan fine ($76,000), after being prosecuted by the Guangxi Pingnan County People's Procuratorate.
Wu "illegally profitted" from setting up VPN servers and selling software "without obtaining relevant business licenses", a news website managed by the Supreme People's Procuratorate -- the national prosecuting authority -- reported Wednesday.
Wu also opened an online store on Taobao, the shopping platform of e-commerce giant Alibaba, and a "Fangou VPN" website to rent or sell VPN software and hardware routers, reaching a sales volume of nearly 800,000 yuan, it said.
China's Ministry of Industry and Information Technology (MIIT) announced in January that it would ban the use of unlicensed providers of VPN services.
In September, 26-year-old Deng Jiewei was sentenced to nine months in jail with a 5,000 yuan fine for selling VPN softwares from October 2015 to 2016.
Tech giants Apple and Amazon, too, have moved to limit their customers' access to the tools in China in what has been seen as a voluntary move to get ahead of the impending crackdown.