Nationwide surveillance of avian influenza viruses (AIVs) in live poultry markets across China has occurred since 2014, providing a resource for AIV prevalence and genetic diversity studies. Here we report that 3,237 of 18,425 samples from poultry were AIV positive (17.57%) between 2019 and 2023, with H9N2 being the dominant subtype. We developed an automated phylogeny-based nomenclature system to classify genetic clades of the dominant H9N2 lineage, the BJ94 lineage. Using this model, we found that ten haemagglutinin (HA) sub-subclades cocirculated in poultry and showed antigenic variation. In addition, 99.46% and 96.17% of H9N2 AIVs in 2021–2023 possessed human-receptor binding-related HA-L226 and human MxA-resistance-related NP-N52 mutations, respectively. H9N2 strains with these two mutations preferred human-type receptors and increased replication in human cells in vitro, regardless of the presence of PB2-V/K/E627. Moreover, H9N2 AIVs containing HA-L226, PB2-V/K627 and NP-N52 were transmitted from infected to naive guinea pigs and ferrets through direct contact and respiratory droplet. This highlights the potential zoonotic risks of H9N2 AIVs.