Japanese Prime Minister Shinzo Abe said his government was making contingency plans in the event of a humanitarian crisis, should the US respond to North Korea's refusal to abandon its nuclear missile programme.
Mr Shinzo also urged North Korea to comply with UN resolutions to refrain from provoking the US into further military action.
North Korea launched a ballistic missile on Sunday but it blew up almost immediately, the U.S. Pacific Command said.
Today, US Vice President Mike Pence visited the demilitarised border between North and South Korea and repeated that the US era of "strategic patience" with Pyongyang was over.
Shinzo Abe has urged Kim Jon Un to stop antagonising the US
However, Kim Jong-un has refused to back down, despite edging towards all-out war with the US.
The North Korean leader has promised to carry out another nuclear test by next week.
Should war break out, Japan is expecting a huge influx of asylum seekers fleeing the region.
Mr Abe told parliament he was considering the Japanese response to a potential crisis, including floods of refugees and how to evacuate Japanese citizens from South Korea.
Mike Pence has reiterated the US stance over North Korea during his visit to Seoul
He said: "We assume a series of responses in case of evacuees into Japan, such as protecting them, a process of landing, housing facilities and their management, and a screening whether our nation should protect them.”
According to the Japanese National Security Council, there are almost 60,000 Japanese citizens living in South Korea.
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The Prime Minister said he would be discussing the North Korea issue with Russian President Vladimir Putin at a summit later this month.