BEIJING, May 20 (Reuters) - China is turning the site of a prison camp run by Japanese forces during World War Two into a war museum, the Xinhua news agency said on Sunday.

More than 2,000 prisoners from the United States, Britain, the Netherlands and Australia were imprisoned at the camp in Shenyang, a Manchurian city formerly known as Mukden, between November 1942 and August 1945.

More than one in 10 of them died, Xinhua said. Many Chinese believe Japan has yet to apologise properly for its invasion and occupation of China in the years leading up to and during the war.

The 54 million yuan ($7 million) museum in Shenyang will include a two-storey brick building, three bungalows and a water tower, all original camp buildings in the Dadong district, Xinhua said.

Two walls in a square will be inscribed with the names of the prisoners of war.

China has a museum in Nanjing commemorating the slaughter of the citizens of that city, formerly known as Nanking, by invading Japanese troops 70 years ago.

Nanjing has become the focal point for Japanese ultra-nationalists who dispute the Chinese estimate that 300,000 died or even that any massacre occurred.

An Allied tribunal after the war put the death toll at about 142,000 men, women and children.

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