The jungles of the Diaolou Mountains do not, at first sight, appear a very inviting location for a golf resort. Leeches and spiders drop through the Jeep windows as we jolt along an overgrown logger's track to reach this remote corner of Hainan, the tropical island that marks the south-eastern extremity of China.

On one side lies a pristine tropical rainforest with 1,000-year-old trees; on the other, a thick tangle of bamboo, cedar and palm has reclaimed an abandoned betel nut plantation.

Until now, this national park has been a rare conservation success story in China. Clouded leopards and black gibbons are among the 300 endangered species listed in this sanctuary.

But while the jungle has been allowed to grow back, the park's managers have been forced to watch with frustration as neighbouring communities cash in on one of the biggest, fastest surges in property prices in the world.

The value of land in Hainan has increased by between 50% and 100% since the start of the year, boosted by a government drive to turn the island into an upscale tourist resort.

For the park's managers, the temptation is now too great to resist. "We are sitting on a goldmine," says Zhong Guanghao, the deputy director of the forest bureau, as he exhales a plume of cigarette smoke. "Within five years, we'll have at least two five-star hotels, dozens of town houses, a conference centre and a 36-hole golf club."

His colleague Lu Yongquan takes me to the proposed site in a four-wheel drive that judders across mountain streams, heading so deep inside the forest that there is no mobile phone signal.

"This terrain is very suitable for golf. The environment is quite beautiful," says Lu, who is head of the wildlife department, as we stop to survey the thick forest where his boss wants to build a club covering 300 hectares - the size of about 300 football pitches.

On the park's map, the course is inside the core conservation zone, which is supposed to be off-limits to human activity. But Lu said the government permitted experimental development areas to generate funds for wildlife protection.

"There will be no impact on the eco-system," he insisted. "Only the elite will be able to come. It is not for the masses."

The plan looks certain to stir up controversy.

"You would have to be greedy and heartless to build a golf course in that area," said Yang Xiaobo, a doctor of ecology at Hainan University.

"The biodiversity here is not just important for this island, but for the entire country. There are few rainforests like this in the world."

If the plan for a resort sounds like the thin end of the wedge, it is not alone in Hainan, where golf is increasingly a tool for shifting land-usage rights towards an international jet set, often regardless of the environmental impact.

A quarter of a century ago, China had just one golf course. Today, Hainan alone has almost 30 and senior officials say they want to expand that to 100 and then on to 300.

This runs contrary to central government restrictions on golf development, which is seen as a threat to food security because it often eats up arable land. But Hainan claims an exemption because, officials and local businessmen argue, the island needs golf to become the Hawaii of east Asia.

This is not the only motive. "Golf is a real-estate driven activity primarily in China," said Shane Templeton, course consultant at Sanya Yalong Bay Golf Club. "It is just a vehicle to sell property. You're not supposed to be displacing farmers.

"Now, obviously, there are projects that have bent the rules a little bit, but that is up to the government to control."

The environmental impact goes beyond land acquisition. Established 10 years ago, Sanya Yalong is one of the oldest and best-run clubs on the island, but it still needs to fight a chemical war against Japanese cockchafers, ground pearl and other invasive pests that have been brought in with the imported soil for the greens and fairways.

Golf's supporters say the amount of pesticide needed for courses is less than that applied by farmers on their crops. Groundsmen also lay plastic under the soil to ease risks of water supply contamination. But this too can cause problems if huge areas of land are covered.

"When there are several golf courses in close proximity, we have to be very careful about the impact on ground water ... That changes the run-off," someone involved in environmental impact assessments told the Guardian. "There are violations but I can't talk about them ... Some projects start construction before they have gone through an environmental impact assessment."

At the centre of such concerns is Mission Hills, the biggest golf development in Hainan, covering an area the size of a city. The management company already runs the biggest golf course in the world at nearby Shenzhen. Initial reports suggested the new development in Hainan would be far bigger: as many as 22 courses are talked of.

After an outcry, executives are now downplaying their ambitious. They talk only of "at least six courses", which are already either finished or under construction. But banners displayed around the club still boast it will be "Number One in the World".

It is an astonishing sight. From the terrace of the newly built clubhouse, bunkers and greens appear to stretch endlessly towards the horizon on all sides. Executives claims it is one of the world's most eco-friendly courses because it is built on volcanic scratch land at great cost.

"What we are doing could be the future of golf, because we are using deserted land rather than arable fields," said Jiaqi Li, the executive director. "Not one family had to be moved for any of our six courses."

But her claims are questioned by local people.

In Changyong village on the edge of the course, residents said they have been flooded for the past two years by water than runs off of plastic sheeting under the huge course.

"It's had a huge impact," said Deng Zhenhe. "We never had flooding in the past. Now it comes three months every year. The water comes up to our waists sometimes. Cars can't get through."

At Bopian village, a crowd gathers to express their grievances. "The golf club has cut down many big trees and the lychee and longan trees we used to farm. Our sheep and cows have nowhere to graze," said a man who gave only the surname Wu. "I was cheated of some of my land."

Mission Hills insists the correct procedures were followed. "The environmental impact assessment has been completed and all the experts have put their signatures to the approval," said Li.

But the Guardian has learned that concerns have been raised by inspectors about the risk to biodiversity and water systems. During the environmental impact assessment for Missions Hills, they found several rare plant species, including Ottelia cordata and Aportea sinuate, that are not found anywhere else on Hainan. In addition, they warned of a potential risk of flooding and contamination of groundwater supplies for the nearby city of Haikou.

"We have not finished the paperwork because of these problems," said the source involved with assessment. "We have offered advice on the scale of the course and how to reduce pollution. The matter is still very sensitive."

Local government officials acknowledged concerns about groundwater, but appeared to be in the dark about the scale of the golf club's expansion.

"Mission Hills has completed environmental assessment and received proper permission for only one course," said Cai Qiao, director of the Haikou tourism development committee. "I'm sure they have completed only one course, not three."

As he spoke, golfers were putting and driving on the finished courses and bulldozers were clearing the way for three more. Hollywood stars are lined up for a celebrity tournament for the opening in October and, by next autumn, the club expects to host the World Cup of golf. Permission is taken for granted.

Golf in China: the hole story

• A game similar to golf was played in China more than 500 years before the sport in its modern form was started in Scotland.

Jade-and-gold clubs were used in "chuwan", according to sketches and writings dating back to the Tang dynasty (960-1279).

• The first recorded golf club on the mainland was established in Shanghai by British expatriates in 1896. The nine-hole course sat on what is now People's Square. Players from Shanghai often competed against rivals from Hong Kong.

• After Mao Zedong's Communists came to power in 1949, golf was condemned as a bourgeois imperialist sport and the few courses closed.

• In the modern era of opening and reform, the first course was constructed in 1984. This was followed by such a rash of golf development that the government grew concerned about the loss of arable land and tried to impose restrictions.

• Today, there are an estimated 600 courses in China, many of which dodge the regulations by claiming to be landscaping projects or vaguely defined property developments.

With golf due to become an Olympic sport by 2016, its popularity is expected to grow. Last year, Jack Nicklaus reportedly claimed the country was planning to build 1,400 public courses over the next five years.