As a safety precaution, a cull of 17,000 chickens was carried out on Wednesday.

York Chow, secretary for food and health, announced the test result before midnight on Tuesday.

Sales of live poultry in Hong Kong markets were placed on immediate hold for 21 days.

Local hospitals were told to raise their flu alert to "serious" as a precautionary measure.

A laboratory at the University of Hong Kong is now determining whether the virus strain found in the dead bird had mutated, which would have made the virus vaccine-resistant.

The 17,000 live chickens at the Cheung San Wan wholesale market were exposed to lethal gas in an operation that began at about 11 am on Wednesday.

The remains were wrapped in black plastic bags, to be disposed of in a landfill.

Wholesalers will be paid HK$30 ($3.85) for each culled bird under an agreement reached in 2008.

Mr Chow admitted there was a chance that other sick birds at the market had already been slaughtered and sold to the public later in the day.

Mr Chow assured anxious consumers that there is no danger from eating an infected bird, as long as it is properly cooked.

Experts also said health risks are not as great as the mass cull make it appear.

Yuen Kwok-yung, chair of infectious diseases at the Department of Microbiology of University of Hong Kong, said the next two weeks will be critical in determining how extensively the strain had spread since an infected bird may not show symptoms for a week.

Retail and wholesale markets are required to clear all live poultry by the end of trading every day.

Lo Wing-lok, a specialist in infectious disease, said the overall risk remains low at the moment, as the infection has not turned into a massive outbreak and the prevalence of the virus in the environment is presumed to be low.

Chickens both from local farms and designated farms on the mainland are vaccinated and inspected before heading to the market, where carcasses are tested for viruses.

The discovery and containment of the flu indicated the system is working, Dr Wing-lok pointed out.

But the investigation into how this particular chicken slipped through the strict preventive regime has proven difficult, because individual chickens are not marked.

Mr Chow said it was "a good question" to ask if a leg band could be fitted to each chicken at poultry farms.

The New Territories Chicken Breeders Association doubted whether its members have sufficient staff to fit a band on every bird. Vice-Chairman Lee Leung-kei asked for financial support from the government if the HK$1 band becomes mandatory.

So far, chickens at local farms have been spared from culls, since no outbreak was visible during inspection of all but one of the 30 local poultry farms on Wednesday morning. Samples were collected for further virus tests.

The alarm went off earlier this month after two wild bird carcasses were found in the New Territories. Both tested positive for the H5N1 flu virus.

Further Reading

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You can visit the Avian Flu page by clicking here.