In China, General Motors and Ford Motor are offering small SUVs Trax and EcoSport, respectively, among other carmakers.
The ix25 concept, which debuted at the Beijing auto show, is smaller than Hyundai's Tucson compact SUV and will go into sales in the second half of this year, Hyundai said.
(Read more: Toyota Motor aims to double sales in China)
Hyundai, which now sells a mini-SUV only in Brazil, did not say whether it will roll out similar products in other key markets such as India, the United States and Europe.
Hyundai, which ranks fifth in global sales along with affiliate Kia Motors, hopes the upcoming model will help retain its momentum in China, which generates 22 percent of its sales.
With Hyundai's sales in the United States and Europe stagnating, China is a bright spot for the carmaker. Its China sales rose 9 percent to 270,347 vehicles in the period from January to March, compared to a year earlier.
(Read more: VW to add China capacity amid growth expectations)
Hyundai's chief financial officer earlier said the firm hoped to boost China sales by more than 10 percent to more than 1.13 million vehicles this year, aided by a capacity hike at its third Chinese plant and a new commercial vehicle factory there.
Kia unveiled the K4 family sedan concept aimed at Chinese customers in their 30s and 40s, planning to roll out the model in the second half of this year.
(Read more: Carmakers set to battle for Chinese consumers)