The Chancellor, who is leading a trade mission in China, told students in Beijing his visit was about "much more than a collection of business deals".
Mr Osborne said he wanted to make it clear to the whole of China that there is no limit on trade with Britain or the number of Chinese people who can come to study or visit.
A real dialogue between the two nations, he said, is about learning, understanding and "embracing the future together", as he announced a partnership between Peking University, where he spoke, and Manchester University to create a joint centre for genomic medicine.
While acknowledging that "we should not be afraid of pointing out where we disagree", Mr Osborne said the West should not harbour "outdated" and "nervous" views and also welcomed Chinese investment in critical infrastructure such as water and airports.
Mr Osborne said: "This partnership will - I hope - give even more of you the chance to come to Britain and study there.
"I want more of you to come. And more Chinese visitors too.
"Let me make this clear to you and to the whole of China.
"There is no limit to the number of Chinese who can study in Britain.
"No limit to the number of Chinese tourists who can visit.
"No limit on the amount of business we can do together.
"For in the end what is a true dialogue?
"Not just a meeting between governments. Not just a conference of politicians.
"A real dialogue is where people get together, and talk, and learn, and understand and embrace the future together."
Mr Osborne's push came a day after he announced a relaxation of the visa rules for Chinese nationals - amid complaints the current regime is a deterrent to more high-spending visitors coming to the UK.
The Chancellor, who yesterday unveiled an £800 million plan for Chinese investment in Manchester Airport, also said Britain would not be like other European countries that put up trade barriers to China.
He said: "Not every country in the world is happy to see foreign investment, including Chinese investment.
"There are some countries, including some in Europe, who think the answer to the global race is to erect trade barriers and find all sorts of ways of making it clear that Chinese investment is not welcome.
"Britain is not one of those countries.
"Indeed, I would go as far as to say that there is no country in the West that is more open to investment - especially investment from China - than the United Kingdom is.
"For example, who owns a large share of the London water supply - and a share of Heathrow Airport?
"That is the China Investment Corporation.
"Some nations wouldn't want Chinese investment in critical infrastructure like water and airports. We positively welcome it.
"Just as you welcomed the British design partnerships that built Beijing's Terminal 3."
Mr Osborne, who is holding talks around the internationalisation of the Chinese Renminbi currency tomorrow, also said he wanted London to become a home for Chinese banks, bonds and finance.
Boris Johnson, who shared a platform with the Chancellor, reiterated his desire for more two-way traffic, with more Chinese students coming to the UK but also more British people studying in China.
True to form, the Mayor of London jovially concluded that fictional wizard Harry Potter's first kiss with Chinese Hogwarts student Cho Chang illustrated the future for the capital and Britain.
Mr Johnson said: "I very much hope that this will continue to grow and intensify in the years ahead so that we see more trade and investment but also so that it becomes as regular for British students to come and pursue their studies in China as it is for Chinese students to come to London."
He went on: "And if you want one final proof of how fast the world is changing, the cultural interpenetration between Britain and China, let me ask you a question, brilliant students of Peking University.
"Who in English literature is the most famous student? Who is the most famous student in contemporary British writing, would you say? I will give you a clue - he sometimes has a wand... Harry Potter."
He then quizzed students: "Where does the train go from which Harry Potter has to catch to go to his school? King's Cross, absolutely right, which is where? London.
"Where does Harry Potter buy his uniform and his wand and stuff like that and his books? I think it's in Diagon Alley which is in London.
"Where is the location of the Ministry of Magic? London.
"And who according to JK Rowling, the author of the Harry Potter novels, was Harry Potter's first girlfriend? Who is the first person he kisses? That's right, Cho Chang - who is a Chinese overseas student at Hogwarts school.
"Ladies and gents I rest my case. I don't think I need to argue any further, that is the future of Britain and of London."
The pair's visits to China with separate delegations reflect a determination to rebuild Britain's relationship with Beijing which has been in deep freeze since David Cameron welcomed exiled Tibetan spiritual leader the Dalai Lama to London last year.
The main government-to-government business of the five-day visit will take place tomorrow when Mr Osborne attends the fifth UK-China economic and financial dialogue in Beijing. He will also hold a series of bilateral meetings with senior Chinese leaders, including vice premier Ma Kai.
He will then travel on to the cities of Shenzen and Guangzhou on Wednesday, followed by Hong Kong on Thursday, accompanied by delegations from the asset management and hi-tech sectors.
Meanwhile, Mr Johnson will meet high-powered investors, including those pumping money into London, before travelling on to Shanghai on Wednesday and Hong Kong on Thursday, where he will be given a tour of its island airport.
CBI director-general John Cridland said: " These important changes will make the UK much more appealing to Chinese business and tourists alike and are likely to give a welcome boost to all sectors of UK business in the months ahead."
Home Secretary Theresa May said: " We are continuing to attract the brightest and best to work and study in the UK, while preventing immigration abuse and bringing net migration down to the tens of thousands.
"Our Chinese visa system already provides an excellent service and figures demonstrate that Chinese tourists are increasingly choosing to visit the UK.
"We will continue to make further improvements wherever possible for visitors travelling independently or as part of a group."
VisitBritain chief executive Sandie Dawe said: "Tourism is a key industry for Britain in China. Last year witnessed a record jump of 20% in visits and 25% in spending.
"We now compete in the global race for the world's most valuable tourism market and know there is already a huge aspiration to travel to Britain, so we want to make it easier to get here and show how welcome our Chinese visitors are.
"The changes made today by the Chancellor underscore that message, and if trends continue, we are set to see another record year for the Chinese in 2013."