The United States has said it was ready to use force if need be to stop North Korea's nuclear missile programme.
However US Ambassador to the United Nations Nikki Haley said it preferred global diplomatic action against Pyongyang for defying world powers by test launching a ballistic missile that could hit Alaska.
Ms Haley told a meeting of the UN Security Council that North Korea's actions were "quickly closing off the possibility of a diplomatic solution" and the US was prepared to defend itself and its allies.
"One of our capabilities lies with our considerable military forces. We will use them if we must, but we prefer not to have to go in that direction," Ms Haley said.
She urged China, North Korea's only major ally, to do more to rein in the North Korean authorities.
Taking a major step in its missile programme, North Korea yesterday test launched an intercontinental ballistic missile that some experts believe has the range to reach the US states of Alaska and Hawaii and perhaps the US Pacific Northwest.
North Korea says the missile could carry a large nuclear warhead.
The missile test is a direct challenge to US President Donald Trump, who has vowed to prevent North Korea from being able to hit the United States with a nuclear missile.
He has been urging China to press the isolated country's leadership to give up its nuclear programme.
Ms Haley said the US would propose new UN sanctions on North Korea in coming days and warned that the US government was prepared to cut off trade with countries doing business with North Korea in violation of UN resolutions.
Much of the burden of enforcing UN sanctions rests with China, she said.
Diplomats say China has not been fully enforcing existing international sanctions on its neighbour and has resisted tougher measures, such as an oil embargo, bans on the North Korean airline and guest workers, and measures against Chinese banks and other firms doing business with the North.
The US might seek to take unilateral action and sanction more Chinese companies that do business with North Korea, especially banks, officials said.
China's UN ambassador, Liu Jieyi, told the Security Council meeting that the missile launch was a "flagrant violation" of UN resolutions and "unacceptable."
"We call on all the parties concerned to exercise restraint, avoid provocative actions and belligerent rhetoric, demonstrate the will for unconditional dialogue and work actively together to defuse the tension," Mr Liu said.
The United States has remained technically at war with North Korea since the 1950-53 Korean conflict ended in an armistice rather than a peace treaty and the past six decades have been punctuated by periodic rises in antagonism and rhetoric that have always stopped short of a resumption of active hostilities.
Tensions have risen sharply in recent months after North Korea conducted two nuclear weapons tests last year and carried out a steady stream of ballistic missile tests
North Korean leader Kim Jong Un said the ICBM test completed his country's strategic weapons capability that includes atomic and hydrogen bombs, the state KCNA news agency said.
North Korea will not negotiate with the United States to give up those weapons until Washington abandons its hostile policy against the North, KCNA quoted Kim as saying.
The White House has said it is exploring its options on North Korea.
"I think we've been pretty consistent that we're never going to broadcast any next steps. We're exploring those options," White House spokeswoman Sarah Sanders told reporters on Air Force One as Mr Trump flew to Poland.
Mr Trump and other leaders from the Group of 20 nations meeting in Germany this week are due to discuss steps to rein in North Korea's weapons programme, which it has pursued in defiance of Security Council sanctions.