China has rejected an offer from the US to host three-way talks with Japan over the future of a group of disputed islands in the East China Sea.
A Chinese foreign ministry spokesman said the dispute involved only two nations, not the US.
The idea was suggested by US Secretary of State Hilary Clinton last week and reiterated after China's refusal.
Tensions have been high since the Japanese detained a Chinese trawler captain near the islands in September.
The islands - known in Japan as Senkaku and in China as Diaoyu - are controlled by Japan, but claimed by China.
They are close to key shipping lanes, offer rich fishing grounds and are thought to have oil deposits.
Three is a crowd?
Hillary Clinton met her Chinese counterpart, Yang Jiechi, at a regional summit in Vietnam last week and offered to hold three-way talks.
"I want to emphasise that this is only a US idea," China's foreign ministry spokesman Ma Zhaoxu said in a statement.
"It must be pointed out that the Diaoyu islands are Chinese territory, and the territorial dispute between China and Japan over the Diaoyu islands is the business of the two nations only," the statement said.
"The United States has many times said that US-Japan security treaties can apply to the Diaoyu islands. This is totally wrong.
"The US side should immediately correct this mistaken position," he added.
Despite China's refusal Mrs Clinton said the offer still stood.
The diplomatic spat between China and Japan flared up again, hours after an apparently friendly bilateral meeting on the sidelines of the Association of South East Asian Nations summit last week.
Beijing accused Tokyo of distorting facts over September's collision between two Japanese patrol boats and a Chinese trawler.
The incident has brought relations between China and Japan to their lowest point for years, analysts say.