A North Korean official said the "hostile activities of South Korea and the US" had left Pyongyang with "no choice."
North Korea will pursue "acceleration" of its nuclear and missile programmes despite threats of increased sanctions, a diplomat from the country said on Tuesday.
This includes developing a "preemptive first strike capability" and an inter-continental ballistic missile (ICBM), said Choe Myong Nam, deputy ambassador at the North Korean mission to the UN in Geneva.
The US is considering sweeping sanctions as part of a broad review of measures to counter North Korea's nuclear and missile threat, a senior US official in Washington, said on Monday.
"I think this is stemming from the visit by the Secretary of State [Rex Tillerson] to Japan, South Korea and China ... We of course are not afraid of any act like that," Choe said.
"Even prohibition of the international transactions system, the global financial system, this kind of thing is part of their system that will not frighten us or make any difference."
He denounced joint annual military exercises currently being carried out by the US and South Korea on the divided peninsula and criticised remarks by Tillerson during his talks with regional allies last week.
"All he was talking about is for the United States to take military actions on DPRK," Choe said, using the acronym for the Democratic People's Republic of Korea.
North Korea rejects claims by Washington and Seoul that the military drills are defensive. They involve strategic nuclear bombers and a nuclear submarine, Columbus, that recently entered South Korean ports, he said.
"In the light of such huge military forces involved in the joint military exercises, we have no other choice but to continue with our full acceleration of the nuclear programmes and missile programmes. It is because of these hostile activities on the part of the United States and South Korea."
"We strengthen our national defense capability as well as preemptive strike capabilities with nuclear forces as a centrepiece," Choe said.
Asked to comment on Choe's remarks, US State Department spokeswoman Anna Richey-Allen called on North Korea "to refrain from provocative actions and inflammatory rhetoric ... and to make the strategic choice to fulfil its international obligations and commitments and return to serious talks."