According to the Xinhua newswire, the case has been the biggest piracy scheme in the country's history.
Hong Lei, the creator of the downloadable "Tomato Garden Windows XP" CD-ROM, was jailed for three and a half years by a court in Suzhou in eastern China, said Xinhua.
One of his accomplices received the same prison term and two received two years in prison each.
The Tomato Garden version of Windows XP is arguably one of the most widely distributed pirated versions of the operating system, Infosecurity notes.
The China newswire said that the pirate version of Windows XP "crippled the program's authentication and certification barriers... allowing users unrestricted access to the popular Microsoft software."
Initially, the software was available for download on the tomatolei.com web site, which opened in 2004, and made its earnings from advertisements on the site.
The software was subsequently amended and sold through Chinese outlets in the UK, Europe and and US.
Despite the high profile case, which has been on Chinese TV news reports for the last week, many observers have called the Chinese government's campaign against piracy less than effective.
In a statement issued by his office, US Congressmen Howard Berman, who has been visiting China, said that China's efforts to stop intellectual property theft have been weak and ineffective.
They have been heavy on tough talk but light on implementation, said the Congressman, adding that "hundreds of websites provide downloads and links to pirated movies, recordings and games."
The case against Hong and his accomplices started in June of last year, when the Business Software Alliance made a formal complaint to the Chinese government, at which stage the government moved in and arrested the team.