On Friday, South Korea and the United States announced they agreed to deploy the THAAD system with the USA military stationed in South Korea to counter North Korea's missile threat.
North Korea's Foreign Ministry called the sanctions against supreme leader Kim Jong Un "the worst hostility and an open declaration of war", vowing to take "the toughest countermeasures to resolutely shatter the hostility of the U.S.".
"We should strongly condemn the launch by working with the worldwide community", said Japanese Prime Minister Shinzo Abe said according to Kyodo news agency.
North Korea launched a ballistic missile from a submarine Saturday, but the rocket exploded soon after take-off, the South's military said. An official at Seoul's Defense Ministry on Saturday couldn't immediately confirm how far the projectile traveled or where it landed.
The missile was sacked from near the North Korean coastal town of Sinpo, where analysts have previously detected efforts by the North to develop submarine-launched ballistic missile systems, the defence ministry official said.
The U.S. Treasury Department said the sanctions targeting Kim, 10 other North Korean officials and five entities are as a result of their role in "notorious" human rights abuses.
"North Korea should clearly recognize that it can never get what it wants through military threats like the missile launch", said Lee Jae-kyoung, spokesman for the main opposition Minjoo Party.
China said the THAAD system would destabilize the regional security balance without achieving anything to end North Korea's nuclear programme.
Neighbouring Japan, the United States, and South Korea's military condemned the missile launch as a flagrant violation of UN sanctions.
Pyongyang has refused to comply with multiple United Nations resolutions by continuing to carry out nuclear and ballistic missile tests - and regularly threatening to attack its enemies.
North Korea launched two medium-range ballistic missiles in June. Pyongyang also conducted a test of a submarine-launched ballistic missile (SLBM) in April, calling it a "great success" that provided "one more means for powerful nuclear attack". Beijing said on Friday it lodged complaints with the US and South Korean ambassadors over the THAAD decision. China, Russia and North Korea all say the THAAD deployment could help USA radars spot missiles in their countries.
"If the government of China has a concern with this deployment it should seek to use its influence to change the decisions being made in Pyongyang instead of attempting to limit Seoul's ability to defend itself against the growing threat to its north", McCain said.
"The SLBM (submarine-launched ballistic missile) was ejected from the submarine normally, but is estimated the initial flight was unsuccessful", the South Korean military said in a statement.
A diplomatic source said the North's missile launch could become a testbed for Chinese and Russian cooperation against North Korea. It also criticized the decision to impose sanctions on the leader of its ally North Korea.