Spy satellites have observed North Korea moving a missile into position for a possible launch, with the US saying its forces are on high alert.

Officials have told US media that spy satellites have observed DPRK mobile missile launcher movement, indicating a intermediate-ballistic missile launch may be being prepared.

The report comes as US Secretary of Defence James Mattis warns any further escalation could rapidly lead to war: "Yes that means for a lot of young troops they're going to be in a wartime situation".

Such intermediate missiles do not have the capacity to reach the mainland United States, but can reach the US military bases of Guam and Japan.

The missile being prepared may be a Hwasong HS-12, capable of reaching Guam.

The DPRK has this morning issued a press statement saying it has presented plans to "envelope" Guam in fire to President Kim Jong-un.

"The nuclear force of the DPRK is strong in its guts and no one can guess its muscle as the flight trajectory of medium-to-long ballistic rocket Hwasong-12, firing data and the correct hitting-point are made public at home and abroad."

'POWER DEMONSTRATION'

Pyongyang's state media has this morning reported President Kim Jong-un as having "praised" his Strategic Force for drawing up a "careful" plan for a "power demonstration" to "envelope" Guam in fire.

"The nuclear force of the DPRK is strong in its guts and no one can guess its muscle as the flight trajectory of medium-to-long ballistic rocket Hwasong-12, firing data and the correct hitting-point are made public at home and abroad."

Kim said he would "watch a little more" Washington's behavior, but it will make an "important" decision if the US continues its "extremely dangerous reckless actions".

The missile being prepared may be a Hwasong HS-12. Such intermediate missiles do not have the capacity to reach the mainland United States, but can reach the US military bases of Guam and Japan.

This is a very important photo. It shows Anderson AFB in #Guam as clear as day on the back wall. pic.twitter.com/rQhicoGSRM

— Strategic Sentinel (@StratSentinel) August 14, 2017

'WARTIME SITUATION'

Mattis told reporters in Washington this morning the situation could escalate to war "very quickly".

He said it could be assessed "within moments" if a missile fired from North Korea was on track to hit Guam.

The United States would "take out" any seen to be heading for American soil.

If missiles were fired at US bases: "I think if they fire at the US it could escalate to war very quickly ... Yes, that's called war, if they shoot at us."

He added: "If they shoot at the United States, I'm assuming they hit the United States. If they do that, it's game on."

North Korea's has previously stated its plan is to fire missiles to land in the ocean "near" Guam, not at Guam itself. The US has stated this would be an unacceptable provocation.

Mattis was asked what response the US would give to such a 'near miss': "You can't make all those kinds of decision in advance," he said. "There's a host of things going on. There's allies that we consult with ... "I need a certain amount of ambiguity on this".

Mattis's comments came after he and Secretary of State Rex Tillerson wrote in an opinion piece in The Wall Street Journal that America has "no interest" in regime change in Pyongyang or the accelerated reunification of the two Koreas, and stressed the importance of a diplomatic solution to the crisis.

HOLIDAY SPECTACLE?

Today is a public holiday in North Korea (Liberation of the Fatherland Day - marking the end of World War II). Previous missile launches have been timed to coincide with such calendar events to maximise internal propaganda impact.

This morning's DPRK statement also attacked planned US-South Korea "Freedom Guardian" military drills scheduled for August 21.

"No matter what rhetoric they let out about "annual, regular and defensive drills", they cannot cover up the danger of a war outbreak," the statement says.

"If any accidental case would be sparked, though unwanted, it would never avert a war. What matters is that when a second Korean War breaks out, it would be a nuclear war."