Liu Guoyong, chief of the General Administration of Sports in China Daily said: "Dancing in public squares represents the collective aspect of Chinese culture, but now it seems that the overenthusiasm of participants has dealt it a harmful blow with disputes over noise and venues."
The move comes after residents complained about the loud banging and clanging of props and costumes.
Estimates indicate the number of dancing grannies at 100 million.
The dancing grannies claim they join these groups as a means of staying fit.
In 2013, several Wuhan residents even went to the extent of showering faeces on a group of dancing grannies, reported BBC News.
China's General Administration of Sports and the Ministry of Culture has now issued rules governing the day and night square-dancing.
Dancers are now restricted to 12 approved choreographed practices, according to the Chinese state media.
"The unified drills [routines] will help keep the dancing on the right track where they can be performed in a socially responsible way," said Wang Guangcheng, a fitness trainer and member of the panel.
The choreography will be conducted by an expert panel of dancers and fitness trainers.
The dances will "no longer vary from community to community but will instead become a nationally unified, scientifically arranged all-new activity that brings positive energy to the people," reported Chinese state news agency Xinhua.