U.S. Secretary of State Hillary Rodham Clinton responded by saying North Korea faces consequences for its nuclear and missile tests and denouncing its "provocative and belligerent" threats.
She also underscored the firmness of the U.S. treaty commitment to defend South Korea and Japan, which are in easy range of North Korean missiles.
The U.N. Security Council was debating how to punish the North for its nuclear test Monday, what President Barack Obama called a "blatant violation" of international law.
Ambassadors from the five permanent veto-wielding council members - the United States, Russia, China, Britain and France - as well as Japan and South Korea were working on a new resolution.
South Korea, still divided from the North by a heavily fortified border, had responded to the nuclear test by joining the Proliferation Security Initiative, a U.S.-led movement to stop ships from transporting banned nuclear goods.
Pyongyang lashed out at both the U.S. and South Korea, calling Seoul's move to join the PSI tantamount to a declaration of war and a violation of the truce keeping the peace between the two Koreas.
"Full participation in the PSI by a side on the Korean Peninsula where the state of military confrontation is growing acute and there is constant danger of military conflict itself means igniting a war," North Korea's Committee for the Peaceful Reunification of Korea said in a statement carried on state media.
The regime warned that it would "deal a decisive and merciless retaliatory blow" to anyone trying to inspect its vessels.
North Korea's army said it would be "illogical" to honor the 1953 armistice between the two Koreas, given the violations by the U.S. and South Korea, and said it could no longer promise the safety of U.S. and South Korean warships and civilian vessels in the waters near the maritime border.
The Korean People's Army said in a statement that North Korea has "tremendous military muscle" and was "able to conquer any targets in its vicinity at one stroke."
Clinton said North Korea has made a choice to violate U.N. Security Council resolutions, ignore international warnings and abrogate commitments made during six-nation nuclear disarmament talks.
"There are consequences to such actions," she said, referring to discussions in the United Nations about punishing North Korea for its nuclear and missile tests.
She did not provide specifics, saying only that the intent of diplomats was to "try to rein in the North Koreans" and get them to fulfill commitments made in the nuclear talks.
Clinton said she was pleased by a unified international condemnation of North Korea that included Russia and China, North Korea's closest major ally and the host of the currently stalled disarmament talks.
Despite her tough words, Clinton held out hope that North Korea would return to nuclear disarmament talks and that "we can begin once again to see results from working with the North Koreans toward denuclearization that will benefit, we believe, the people of North Korea, the region and the world."
At the White House, spokesman Robert Gibbs played down North Korea's angry rhetoric, saying the threats will only add to its isolation.
He said North Korea has threatened to end the armistice many times in the past but the peace has held.
The Russian Foreign Ministry said it voiced "serious concern" about the nuclear test to the North Korean ambassador and urged Pyongyang to respect the U.N. resolutions and return to the disarmament talks.
The truce signed in 1953 and subsequent military agreements call for both sides to refrain from warfare, but don't cover waters off the west coast. North Korea has used the maritime border dispute to provoke two deadly naval skirmishes - in 1999 and 2002.
The latest confrontation comes as Pyongyang may have restarted its weapons-grade nuclear plant, South Korean reports said.
U.S. spy satellites detected steam at North Korea's Yongbyon nuclear complex, a sign it may be reprocessing nuclear fuel, the Chosun Ilbo newspaper said, citing an unidentified government official. South Korea's Yonhap news agency carried a similar report.
But the Institute for Science and International Security think tank in Washington said commercial satellite imagery by DigitalGlobe taken on Tuesday did not show any steam.
The move to restart the plant would be a major setback for international efforts to get North Korea to disarm. North Korea has about 8,000 spent fuel rods which, if reprocessed, could allow it to harvest 13 to 18 pounds of plutonium - enough to make at least one nuclear weapon, experts said.
North Korea now is believed to have enough plutonium for at least a half-dozen weapons, but experts say it still has not mastered the miniaturization technology required to mount a nuclear warhead on a long-range missile.
After firing a long-range missile on July 4, 2006, and carrying out its first nuclear test three months later, North Korea agreed in February 2007 to start disabling Yongbyon in exchange for 1 million tons of fuel oil and other concessions. Disablement began in November 2007.
The process halted last summer in a dispute with Washington over verifying past atomic activities, and Pyongyang said last month it was quitting the talks altogether.
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