US President Donald Trump offered some backhanded praise for North Korean leader Kim Jong-Un, calling him "a pretty smart cookie" in a television interview that aired Sunday.
It is North Korea's ninth attempted missile launch since Trump became President in January.
Asked if that means military action, Trump responded: "I don't know".
North Korean ballistic missile tests are banned by the United Nations because they are seen as part of the North's push for a nuclear-tipped missile which can strike the U.S. mainland.
General H R McMaster said on a phone call to his South Korean counterpart, Kim Kwan-jin, that the United States would honour its 2016 agreement to foot the $1 billion bill for the Terminal High-Altitude Area Defense system (THAAD) anti-missile system. Commander Dave Benham, a spokesman for the U.S. Pacific Command, informed the media that the launch had taken place at approximately 9:30 p.m. BST and took place near the Pukchang airfield.
The U-turn comes shortly after the USA sent a fleet of battleships and a nuclear-powered submarine to waters off the North Korean coast and conducted joint military operations with South Korea in a show of defiance against northern dictator Kim Jong-un.
The drills began hours after South Korean and USA officials said they detected what they presumed was a failed missile launch from an area near the North Korean capital, Pyongyang. When completed, it will consist of six truck-mounted launchers that can fire up to 48 interceptors toward incoming missiles detected by the system's x-band radar.
Kirby said there is no such thing as a failed missile attempt for North Korea's Kim. "Our military is maintaining a thorough defense posture while keeping a close eye on the possibility of North Korea's further provocations".
The launch ratchets up tensions on the Korean peninsula, with Washington and Pyongyang locked in an ever-tighter spiral of threat, counter-threat and escalating military preparedness. He says North Korea poses "a grave threat" not just to the United States and its Asian allies, but also to China.
Trump said he had "no idea" whether Kim was sane or not, but said the North Korean leader had faced a formidable challenge in taking over the country at a reported age of 27 after his father's death in 2011.
"I think that, frankly, North Korea is maybe more important than trade".
In Australia, Prime Minister Malcom Turnbull used a commemoration of a World War II naval battle to warn North Korea against destabilizing the region. "But it is clear more needs to be done, and we're going to ask China to do more as we do more".
Pyongyang has warned that if the USS Michigan "tries to budge even a little, it will be doomed to face the miserable fate of becoming a underwater ghost".
"In a nutshell, (North Korea) has already declared not to attend any type of talks which would discuss its nuclear abandonment, nuclear disbandment", Kim In Ryong, North Korea's deputy United Nations ambassador, told The Associated Press. The Obama administration sought to resurrect them in 2012, but a deal to provide food aid in exchange for a nuclear freeze soon collapsed.