The test came just hours before Secretary of State Rex Tillerson met with Chinese President Xi Jinping in Beijing.
Tillerson ended his first trip to Asia since taking office with an agreement to work with China on North Korea.
China, the North's biggest source of diplomatic support and economic assistance, hasn't responded directly to his remarks, although Beijing has called repeatedly for all sides to take steps to reduce tensions.
The U.S. and North Korea "are like two accelerating trains coming toward each other, and neither side is willing to give way", Wang, the foreign minister, told reporters last week.
North Korea has amassed a sizable nuclear stockpile and appears at the brink of being able to strike the US mainland and American allies in Asia.
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Rex Tillerson and Wang Yi.
North Korea conducted a test of a new high-thrust engine at its Tongchang-ri rocket launch station and leader Kim Jong Un said the successful test was "a new birth" of its rocket industry, Pyongyang's official media said on Sunday. -South Korea military drills.
Last month, China potentially deprived Mr Kim's regime of a crucial source of foreign currency by banning imports of North Korean coal for the rest of the year.
On Friday, Tillerson signaled a tougher strategy toward North Korea that leaves open the possibility of pre-emptive military action.
Wang pledged to maintain United Nations sanctions on North Korea but said Security Council resolutions had also included "clear provisions for efforts to resume talks to de-escalate the tension and to safeguard stability on the peninsula". On Friday in Seoul, he warned ominously that all options were on the table to counter the threat from Pyongyang.
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"It is unreasonable for the United States to accuse China of doing nothing on the DPRK (North Korea)", Wang said.
North Korea has accelerated its weapons development, violating multiple Security Council resolutions without being deterred by sanctions. It conducted two nuclear test explosions and 24 ballistic missile tests a year ago. Experts say it could have a nuclear-tipped missile capable of reaching the US within a few years.
For the meantime, China has vented most of its fury on South Korea, where the USA has deployed anti-missile defenses known as Terminal High-Altitude Area Defense, or THAAD.
KCNA quoted the unidentified Foreign Ministry spokesman as saying the USA should accept that North Korea is a nuclear-capable nation that "has the will and capability to fully respond to any war the US would like to ignite".
The announcement's timing appeared meant to sour Tillerson's China visit.
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"The better they know one another, the stronger will be our bilateral relations as well, because they can provide direction and guidance to both of our governments on how we can work more closely together to strengthen this very important relationship not just for our two countries but for many countries in the region and around the world", Tillerson said. He has also said the US would not continue participating in the U.N. Human Rights Council unless it undergoes "considerable reform".