The Chinese foreign ministry has summoned the US ambassador to protest over the move near some disputed islands, which China describes as a threat to its sovereignty.
It is a significant escalation of the dispute over the strategically vital passageway China claims almost in its entirety, even waters close to the coasts of other nations.
The United States warship's passage near disputed islands in the South China Sea has angered China, which describes it as illegal.
The missile destroyer the USS Lassen passed within 12 nautical miles of at least one of the formations China claims in the Spratly Islands.
The United State has confirmed the operation took place, apparently as part of its so-called Freedom of Navigation program.
Under international law, a country's territorial waters extend 12 nautical miles from its shore.
However, the United States and other countries argue the rule cannot apply to man-made islands such as those in the area constructed by China.
United States Defense Secretary Ash Carter has been questioned over the alleged violation in the US Senate, prompting this exchange:
(Carter:) "We have said -- and we are acting on the basis of saying -- that we will fly, sail and operate wherever international law permits."
(Senator:) "Did we send a destroyer inside the 12-mile zone?"
(Carter:) "There have been naval operations in that region in recent days, and there will be in the weeks and months ahead."
(Senator:) "Inside the 12-mile zone which China built up?"
(Carter:) "I don't want to comment about a particular operation."
(Senator:) "You don't want to comment? It's all over the press right now."
(Carter:) "I'm sure, I'm sure it is, but we reserve the right to conduct ..."
A spokesman for China's foreign ministry, Lu Kang, says the ship had been tracked and warned while on the mission to deliberately enter the disputed waters.
He has warned China would respond resolutely to any country carrying out what he described as deliberately provocative actions.
"If any country has any illusions about carrying out any actions to interfere in, or obstruct, or hinder China's legal, reasonable and fair activities on our territory, I urge those countries to abandon these illusions as soon as possible. In fact, if the relevant party continues to create tensions in the region, in the end it may make China come to the inevitable conclusion that maybe we do have to strengthen and quicken the building up of our capacities. I advise the United States not to make a fool out of themselves in trying to be smart."
Australia has backed the United States' right to sail the warship in the area.
Defence Minister Marise Payne said in a statement all states have a right under international law to freedom of navigation and freedom of overflight, including in the South China Sea.
However, Senator Payne says Australia will not be joining the naval exercise.
The Philippines has also welcomed US navy patrols in the South China Sea.
President Benigno Aquino says freedom of navigation should be guaranteed, provided the sea patrols are within the scope of international law.
"We have one regional superpower who makes, shall we say, some controversial announcements, and the Americans have stated that, if left unchallenged, then this is accepted."
Several South-East Asian countries have competing sovereignty claims to the reefs.
China turned them into islands with a massive dredging project that began in late 2013.
China insists the work is legal and says it has no intention to militarise the islands.
But the United States claims China is constructing military facilities designed to reinforce its disputed claim to much of the region, which is a major global shipping zone.
