Tibet: UN Envoy Cautious on China Rights
But she questioned Beijing's widespread use of the death penalty, warning that some of those being executed might be victims of discrimination.
Ms Arbour was speaking at the end of a five day visit to Beijing.
During her trip an agreement was signed to bring China closer to ratifying a covenant on civil and political rights.
She also raised a number of cases of specific concern to the UN - including cases of detained journalists, labour activists and ethnic minorities - as well as highlighting treatment of Tibetans and the Muslim Uighur minority in the restive region of Xinjiang.
"I'm very energised about the prospect of helping the country face some daunting challenges, and I am guardedly optimistic about the enormous potential for positive change," Ms Arbour told a press conference on Friday.
"The stage is set to expect more than modest progress in coming years," she said.
Later she told the BBC: "I think there is no question that there has been an opening, particularly on political and social rights, which is starting, I think, to permeate throughout the country.
"The government has made a very explicit commitment to work seriously towards the ratification of the international convention on civil and political rights. China has already ratified five of the seven basic international human rights treaties, including the convention against torture, so there are lot of reasons to be optimistic."
She said she had good and "very frank" conversations on human rights issues with Chinese officials. But she voiced concern over the widespread use of the death penalty.
According to Amnesty International, more than 3,700 people are executed in China every year - more than the rest of the world put together. Some are given the death penalty for offences as minor as tax evasion.
Ms Arbour said she was particularly concerned about the death penalty being used against ethnic minorities or the mentally ill, and said there needed to be far greater transparency in how it was applied.
During her trip to China, Ms Arbour met the president of the Supreme Court, as well as the justice minister and several activist groups.
She questioned China's belief that each country should choose its own method of protecting human rights.
"It is not appropriate to say: 'We are doing this our own way'," Ms Arbour is quoted as saying by Reuters news agency.
And while she welcomed China's move towards ratifying the International Covenant on Civil and Political Rights, she warned that if Beijing were to sign right now, "it is pretty clear that the government understands that it would be in non-compliance in many areas".
The high commissioner said she had urged Chinese leaders to change certain legal procedures, particularly on such issues as the death penalty and the controversial "re-education through labour" system.
Source: BBC News