North Korea's much-touted satellite launch ended in a nearly $1 billion failure, bringing humiliation to the country's new young leader and condemnation from a host of nations. The United Nations Security Council deplored the launch but stopped short of imposing new penalties in response.

The satellite's disintegration Friday over the Yellow Sea brought a rare public acknowledgment of failure from Pyongyang, which had hailed the launch as a show of strength amid North Korea's persistent economic hardship.

South Korean men walk past a screen in Seoul showing a TV report on North Korea's rocket launch. (Kim Hong-ji/Reuters)

For the 20-something Kim Jong-un, it was to have been a highlight of the celebratory events surrounding his ascension to top political power. It was timed to coincide with the country's biggest holiday in decades, the 100th birthday of North Korean founder Kim Il-sung, the young leader's grandfather.

The United States and South Korea declared the early morning launch a failure minutes after the rocket shot out from the North's west coast. North Korea acknowledged its demise four hours later in an announcement broadcast on state TV, saying the satellite the rocket was carrying did not enter orbit.

The launch brought swift international condemnation, including the suspension of U.S. food aid, and raised concerns that the North's next move could be even more provocative — a nuclear test, the country's third.

The U.N. Security Council denounced the launch as a violation of two resolutions that prohibit North Korea from developing its nuclear and missile programs, and met behind closed doors to consider a response. U.S. Ambassador Susan Rice, the current council president, refused to speculate on what action the council might take. The council imposed sanctions on North Korea after its first nuclear test in 2006 and stepped up sanctions after its second in 2009.

UN Secretary-General Ban Ki-moon, a former South Korean foreign minister, called the launch "deplorable" and urged North Korea "not to undertake any further provocative actions that will heighten tension in the region," UN spokesman Martin Nesirky said.

New Kim Jong-il statue unveiled

Despite Friday's failed launch, Pyongyang pressed ahead with grandiose propaganda in praise of the ruling Kim family.

Hours after the explosion, the young Kim was installed as the new head of the powerful National Defense Commission during a meeting of the Supreme People's Assembly in Pyongyang. It was the last of the top military and party posts intended to consolidate his power after the death of his father, longtime leader Kim Jong-il, four months ago.

At a massive gathering later Friday, Kim Jong-un and other senior officials watched the unveiling of an enormous new statue of Kim Jong-il, which stood beside an equally massive one of Kim Il-sung.

'While the average North Korean starves and struggles, the country’s rulers squander scarce internal resources and external goodwill.'—Canada's Foreign Affairs Minister John Baird

North Korea had trumpeted the launch of its Kwangmyongsong, or Bright Shining Star, satellite as a scientific achievement and a gift for its late founder. It cost the impoverished nation some $850 million, according to South Korea's Yonhap new agency, which estimated the cost of the rocket and its payload alone at $450 million.

In downtown Pyongyang, university student Kim Kwang Jin was optimistic despite Friday's failure.

"I'm not too disappointed. There was always the chance of failure," he said. "Other nations — including China and Russia — have had failures while building their space programs so why wouldn't we? I hope that in the future, we're able to build a better satellite."

The rocket's destruction suggests the country has yet to master the technology needed to build long-range missiles that could threaten the United States. Still, worries remain about North Korea's nuclear program amid reports that it may be planning an atomic test soon.

The launch was condemned by the foreign ministers of the Group of Eight industrialized nations meeting in Washington, including Russia, while Washington said it was suspending plans to contribute food aid to the North in exchange for a rollback of its nuclear programs.

Canadian Foreign Affairs Minister John Baird issued a statement Friday, saying: "Canada unreservedly condemns North Korea’s rocket launch of earlier today.

"This type of brazen behaviour is entirely reckless and provocative .… While the average North Korean starves and struggles, the country’s rulers squander scarce internal resources and external goodwill."

North Korea announced weeks ago that it would launch a long-range rocket mounted with an observational satellite, touting it as a major technological achievement to mark the centennial of Kim Il Sung's birth.

The failure "blows a big hole in the birthday party," said Victor Cha, former director for Asia policy in the U.S. National Security Council. "It's terribly embarrassing for the North."

Same type of rocket as long-range missile

Experts say the Unha-3 carrier was the same type of rocket that would be used to strike the U.S. and other targets with a long-range missile.

The Unha-3's launch was monitored by a host of U.S., Japanese and South Korean military assets, which were expected to capture vital data on North Korea's ballistic missile capabilities.

U.S. Navy minesweepers and other ships in the area were expected to begin scouring the sea for debris from the rocket, which can offer evidence of what went wrong and what rocket technology North Korea has.

At the Pentagon in Washington, officials said it was believed the failure occurred during the second stage of flight, though it was unclear whether there was a controlled separation from the first stage.

"It was an obvious and very quick failure," Pentagon press secretary George Little said.

Asked whether the failure suggests North Korea poses less of a military threat to the U.S. than has been suggested by the Obama administration, Little said "their recent track record is not good."

But, he added: "We are not discounting the possibility of advancements in North Korean missile technology, notwithstanding their failures."

Greg Thielmann, a former intelligence officer with the U.S. State Department, said it appears the North Koreans haven't mastered the technology they need to control multistage rockets — a key capability if the North is to threaten the United States with intercontinental ballistic missiles.

Watching for possible 3rd nuclear test

North Korea has tested two atomic devices but is not yet believed to be able to build a nuclear warhead small enough to be mounted on a long-range missile.

Cha, who was an Asia adviser for former President George W. Bush, said the next step would be to watch whether North Korea conducts a third nuclear test, as has been speculated by the South Korean intelligence community.

The acknowledgment of the rocket's failure — both to the outside world and to North Koreans — was a surprising admission by a government that in the past has kept tight control over information.

"The failure, which was impossible to hide from the North Korean people given the advance publicity and presence of international media, will be a major source of domestic and international embarrassment for the Kim Jong Un regime," said Ralph Cossa, president of Pacific Forum CSIS, a Hawaii-based think tank.

Attempts to put satellites into orbit often pose problems even for developed nations. In 2010, a South Korean rocket carrying a climate observation satellite exploded 137 seconds into its flight. An earlier 2009 attempt, Seoul's first from its own territory, also failed.

With files from CBC News