The novel H7N9 avian influenza virus (AIV) was demonstrated to cause severe human respiratory infections in China. Here, we examined poultry specimens from live bird markets linked to human H7N9 infection in Hangzhou, China. Metagenomic sequencing revealed mixed subtypes (H5, H7, H9, N1, N2, and N9). Subsequently, AIV subtypes H5N9, H7N9, and H9N2 were isolated. Evolutionary analysis showed that the hemagglutinin gene of the novel H5N9 virus originated from A/Muscovy duck/Vietnam/LBM227/2012 (H5N1), which belongs to clade 2.3.2.1. The neuraminidase gene of the novel H5N9 virus originated from human-infective A/Hangzhou/1/2013 (H7N9). The six internal genes were similar to those of other H5N1, H7N9, and H9N2 virus strains. The virus harbored the PQRERRRKR/GL motif characteristic of highly pathogenic AIVs at the HA cleavage site. Receptor-binding experiments demonstrated that the virus binds α-2,3 sialic acid but not α-2,6 sialic acid. Identically, pathogenicity experiments also showed that the virus caused low mortality rates in mice. This newly isolated H5N9 virus is a highly pathogenic reassortant virus originating from H5N1, H7N9, and H9N2 subtypes. Live bird markets represent a potential transmission risk to public health and the poultry industry.