The Gao'an government in Jiangxi Province received 5,871 coffins given up by residents by June 23, said the report.
The coffin dismantling campaign dissuades locals from traditional burials, which involve expensive coffins and waste of valuable land.
The practice of preparing expensive coffins in advance is prevalent in many regions in China.
The Gao'an government will offer a compensation of 2,000 yuan ($308) for every coffin surrendered. Most locals spent over 3,000 yuan on making one.
It is not reported whether the coffins were dismantled or will be used for power generation as has been done in other townships.
The Gao'an campaign was one of a series of reforms launched in East China to promote green funerals.
In April, Lingxi township in Shangrao, Jiangxi, held a meeting to promote eco-friendly funeral reform, during which many village officials vowed to push forward the reform and nearly 300 wooden coffins were destroyed, triggering online discussions on whether local governments overlook traditions and people's feelings.
While local village governments will compensate residents from 1,000 to 2,000 yuan for each coffin they surrender, residents who keep their coffins may be fined, The Beijing News reported in April.