Chinese production in areas such as electric vehicles, batteries and solar panels "significantly exceeds global demand", Yellen said in a speech in Frankfurt.
The excess capacity "poses a threat to the development of clean energy industries around the world", Yellen said.
The subject "will be a focus at the G7 meetings in Italy later this week", she added.
Finance ministers from the Group of Seven industrialised nations are due to meet in Stresa, Italy, from Thursday.
Washington is concerned that Chinese government support is leading to more production capacity than global markets can absorb, driving cheap exports and stifling growth elsewhere.
Yellen said her concerns had been "communicated directly to my Chinese counterparts", during a visit to the country last month.
The treasury secretary and US President Joe Biden would take action to protect workers and companies from "being undercut by unfair Chinese economic competition", Yellen said.
"We want to see healthy green technology sectors, from innovative start-ups to green manufacturing factories in the United States, Europe and around the world, not just in China," she said.
The United States earlier this month sharply raised tariffs on Chinese-made electric vehicles and other key technologies over capacity concerns.
Meanwhile the European Commission, which participates in G7 summits alongside EU member states France, Germany and Italy, has opened a series of probes into Chinese green tech subsidies.
Beijing has reacted angrily to the US and European Union actions, warning that the move risk souring economic cooperation with China.
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