You can find her in Outworld, in the Lin Chein village.
But first you have to do some tasks before you find/fight/talk to her.
She is hidden in a house.

Queve,
What Tasks do you need to do to be able to enter that village? I can't seem to find anything which opens those gates,
Can someone please help with this?
Thanks,
Tyrant-Cenobite

yea how do i go inside that village thing...theres like fences around it and i cant get in...do i have to beat kenshi training or something....cuz i cant get li mei either....

you'll eventually go into the village. its part of your mission. just keep on playing and you'll be in the village in no time.

The first time you go to Outworld you can't go in the village. You leave Outworld. Later you come back for a second time but you still can't get in there. When you are called there the third time, you will speak to Kano and he tell you to go into the village and you go in one of the houses there and then talk to her.

1 1 2 back 1 spinning kick, somersault flip and then that quick move where she flies toward with her hands is a good combo