North Korea has admitted its heralded long-range rocket launch ended in failure soon after take-off, as world leaders condemned the move as a "provocative" act.
Pyongyang denied it was a missile test in disguise and maintained the mission failed to put a weather satellite into orbit.
It said its scientists were assessing what had caused the rocket to explode over the Yellow Sea.
This admission in itself is an unusual step for the secretive state.
Sky's Holly Williams, reporting from Dandong in China, 30 miles from the launch site, said it was "a disaster" for North Korea.
The rocket launch has drawn international criticism due to concerns it could further the reclusive nation's ability to deliver a nuclear warhead.
The US slammed the launch attempt and said North Korea's leaders should be providing for the nation's impoverished people instead of wasting resources.
It immediately suspended plans to deliver food aid and warned North Korea that it was "further isolating itself by engaging in provocative acts" and "aggressive behaviour".
Jay Carney, a White House spokesman, said: "North Korea's provocative action threatens regional security, violates international law and contravenes its own recent commitments."
Foreign Secretary William Hague expressed "deep concern" over the breach of UN Security Council sanctions.
Mr Hague said: "( North Korea ) can expect a strong response from the international community if it continues to develop its missile and nuclear capabilities.
"I strongly urge (it) to suspend all missile and nuclear-related activity and to commit to re-engaging with the international community."
UN chief Ban Ki-moon described the move as "deplorable", and urged North Korea "not to undertake any further provocative action that will heighten tension in the region".
The UN Security Council is meeting later to discuss a possible response to the rocket launch, diplomats have confirmed.
Permanent members of the 15-nation body - Britain, China, France, Russia and the United States - have already held informal talks and the council is expected to pass a statement condemning the North's latest act.
The North American Aerospace Defence Command (Norad) said it tracked the Taepo Dong-2 missile after its launch.
The first stage fell into the sea 103 miles west of the South Korea capital Seoul, and the remainder of the satellite-carrying missile was deemed to have failed.
Norad said no debris fell on land and at no time was the missile or debris deemed a threat.
Officials in Seoul said the rocket broke into pieces and crashed a few minutes after take-off.
They said they had established where the debris landed and had sent navy ships to salvage it.
The move came despite a warning from the North last week against attempting such an operation.
More than a dozen South Korean navy ships, many of them equipped with sonar and backed by divers, are reportedly combing the area.
The South's foreign minister Kim Sung-Hwan said the North's actions were a "clear breach of the UN resolution that prohibits any launch using ballistic missile technology". He said: "It is a provocative act threatening peace and security."
Japan's chief cabinet secretary Osamu Fujimura also condemned the move.
"Even if it was a failure, it is a grave provocation to our country and other countries concerned and violates UN Security Council resolutions," he said.
China, North Korea's sole major ally, called for "calm and restraint" and for all sides to maintain "contact and dialogue".
Its foreign ministry spokesman Liu Weimin said: "We hope all parties can maintain calm and restraint and not do anything to harm peace and stability on the Korean peninsula."
Russia, which shares a border with North Korea, had urged Pyongyang to refrain from the launch, expressing serious concern and also calling for restraint all round.
Sky's Holly Williams said: "This was supposed to be a propaganda coup ahead of a massive celebration this weekend to mark the 100th anniversary of the birth of Kim Il-Sung - the man who founded the North Korean state.
"His grandson Kim Jong-Un is the country's current dictator. Instead they have had to publicly admit the failure of this launch.
"It is also bad for business. The North Korean state is pretty much on the brink of bankruptcy all the time, but they do make some money from selling their missile technology.
"This was clearly supposed to be an advertisement of sorts, and it was a pretty bad one, so embarrassment all round for North Korea."
The 30m (100ft) Unha-3 (Galaxy-3) rocket had been positioned at a newly-built space centre on the northwestern Yellow Sea coast.
North Korea invited up to 200 foreign journalists to Pyongyang for the launch and the weekend-long commemorations, the largest number of overseas media ever welcomed in to the reclusive state.
The new leader Kim Jong-Un led a mass ceremony in the capital Pyongyang to commemorate the country's two late leaders.
He was seen waving at tens of thousands of people crowding a central area in Pyongyang to honour new large statues of Kim Il-Sung and Kim Jong-Il.