The United States has called on North Korea not to engage in any action that might lead to an "escalation" of Tuesday's naval incident in the Yellow Sea. United Nations Secretary General Ban Ki-moon also urged "maximum restraint" by North Korea and South Korea after the clash that flared cross-border tensions.

A South Korean military spokesman says a North Korean patrol ship crossed into the territorial waters of the South. When the South Korean naval warship fired warning shots, the North Korean ship opened fire, the statement said. The South Korean warship responded by firing back, setting the North's ship ablaze. Ships from North and South Korea then exchanged fire in the waters around their disputed maritime border.

The Communist regime in Pyongyang is demanding an apology for the incident, insisting that its vessel did not leave its own territorial waters and was fired on by the South while withdrawing. North and South Korea have engaged in naval clashes in the Yellow Sea in the past, with fatal consequences on the last occasion, seven years ago.

No casualties have been reported in this latest confrontation, which comes on the eve of a visit to South Korea by US President Barack Obama.