The government has raised its avian influenza alert level to "serious", meaning there is a "high risk" of people contracting the potentially fatal disease, a spokesman for the Department of Health told AFP.

But officials said there was little risk of person-to-person transmission, after a 59-year-old woman tested positive for Influenza A (H5), a variant of bird flu. She was in a serious condition in a hospital isolation ward.

Hong Kong recorded its last human case of bird flu in 2003, and had the world's first major outbreak among humans in 1997, when six people died of a mutation of the virus, which is normally confined to poultry.

Millions of poultry were culled in the 1997 outbreak, which previewed the full-blown panic that struck Hong Kong when the deadly respiratory disease SARS emerged in 2003, killing about 300 people.

Public anxiety returned to the city of seven million people last year with an outbreak of swine flu that has so far claimed about 80 lives.

Bird store owners in the packed shopping district of Mongkok complained their business had never recovered from the public health scares of recent years, which prompted Hong Kong to launch major hygiene campaigns.

"In 30 years I've been in this business, I have never seen trade so bad. It has really hit rock bottom," one store owner aged in his 60s and surnamed Lo told reporters.

"People always talk about how dangerous the bird flu is. It has really hit us hard," he complained, as health officials gathered samples of bird droppings to run tests for the influenza strain.

The latest bird flu patient had recently visited the mainland Chinese cities of Nanjing, Shanghai and Hangzhou, but officials said it was too early to say where or how she contracted the disease.

Hong Kong health chief York Chow tried to downplay fears of a wider outbreak in the densely populated city.

"In general, we think that the risk of avian influenza (spreading) in Hong Kong is not significantly higher than before," he told reporters.

The World Health Organisation said it was not changing its risk assessment of avian flu following the Hong Kong case, saying it fit with the "existing pattern of occasional human infection".

Nevertheless, Chow said the government had stepped up poultry inspections at wholesale markets and enhanced infection controls at public hospitals and clinics.

Visits to isolation wards in public hospitals have been banned, except on compassionate grounds, he said. All visitors were required to put on masks and wash hands before entering public hospitals.

Chow said there was no sign so far of human-to-human transmission in the new case, and the woman likely got the disease by coming into contact with infected poultry.

"But we will be concentrating on people who were in contact with her when she showed symptoms and also when she was in Hong Kong."

Microbiologist Leo Poon from the University of Hong Kong agreed it was likely to be a one-off case and did not pose a serious threat to the city.

"At this stage, the threat is not too big... We believe this is an isolated case," he said, adding that chance of the virus spreading between humans was very slim.

The female patient travelled to mainland China between October 23 and November 1 with her husband and daughter, the Department of Health's Centre for Health Protection said in a statement.

Tests on three of the ill woman's family and five other patients who shared a cubicle with her in a hospital ward came back negative, the department said, although the group remained in quarantine.

Three people who shared a meal with the patient on November 11 had also been traced and none had a fever.

Hong Kong was working closely with mainland Chinese authorities to monitor the situation, a spokesman for the Centre for Health Protection said.

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