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BEIJING, May 31 (Reuters) - The world's only artificially bred panda living in the wild fell to its death just months after it was released, dealing a major setback to China's plan to save the endangered species, Xinhua news agency said on Thursday.

Xiang Xiang, a 5-year-old male whose name means "auspicious", was found dead in snow in the mountainous southwestern province of Sichuan on Feb. 19, 40 days after scientists picked up its trace for the last time via a wireless tracking device.

"We are all sad about Xiang Xiang, but it doesn't mean the project has failed," said Zhang Hemin, head of the China Giant Panda Protection and Research Centre in Wolong.

"The lessons we have learnt from what happened to Xiang Xiang will help us adapt and improve the project."

An examination showed that the panda had suffered rib fractures and internal damage, Li Desheng, deputy director of the Wolong centre, was quoted as saying.

"Experts speculated that Xiang Xiang might have fallen from a high place after getting into a fight with the original 'residents' for food or territory," Xinhua said.

Xiang Xiang was released at the Wolong Nature Reserve for Giant Pandas in April 2006.

"We chose Xiang Xiang because we thought that a strong male panda would have a better chance of surviving in the harsh natural environment," Li was quoted as saying. "But the other male pandas clearly saw Xiang Xiang as a threat.

"Next time we will choose a female panda," he said.

Fan Zhiyong, of the WWF in China, warned scientists at Wolong to be more cautious in selecting a location to release captive-bred pandas.

"Giant pandas are very sensitive when it comes to their own territory and usually one wild panda occupies a territory that covers several square kilometres," Fan was quoted as saying.

Officials attributed the long delay in publicising Xiang Xiang's death to the need for a full investigation.

Xinhua said Xiang Xiang was found with apparent bite injuries on his back, shoulders and sides on Dec. 22. He was taken back to the centre for treatment and sent back to the wild a week later.

But Xiang Xiang had no fighting experience, Tang Chunxiang, a senior Wolong Centre veterinarian, was quoted as saying.

"We have to give captive-bred pandas better survival training, especially combat and defence skills," said Tang.

The giant panda is one of the world's most endangered species and is found only in China. An estimated 1,000 live in Sichuan and in Shaanxi and Gansu provinces in the northwest.

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