China's defence minister has said war with the US would be an "unbearable disaster" for the world in his first major speech since taking on the role.
At a security summit, General Li Shangfu said "some countries" were intensifying an arms race in Asia.
But he said the world was big enough for both China and the US, and the two superpowers should seek common ground.
Earlier, the US accused a Chinese warship of carrying out "unsafe" manoeuvres in the Taiwan strait.
The US Navy said a Chinese destroyer had sailed near one of its destroyers on Saturday and forced it to slow down to avoid a collision. A Canadian ship was also sailing nearby.
China criticised both countries for "deliberately provoking risk". The US and Canada said they were sailing where international law allows.
In his speech, Gen Li, who became defence minister in March, accused the US of a "Cold War mentality" and said this was "greatly increasing security risks".
He said China would not allow naval patrols by the US and its allies to be "a pretext to exercise hegemony of navigation".
Asked about the incident in the Taiwan Strait, he said that countries from outside the region were raising tensions.
He was speaking at the Shangri-La Dialogue in Singapore, the Asia-Pacific region's only annual security meeting.
Beijing has rejected a US request for direct military talks in protest at sanctions placed on Gen Li by the US in 2018 over weapons purchases from Russia.
In Washington, State Department deputy spokesperson Vedant Patel said that the US hopes to have a "predictable" relationship with China and avoid "any new Cold War".
"Our competition must not spill over into conflict," he added.
The Chinese defence minister's "moderate" tone signals that talks with his US counterpart are possible, but Washington has to lift sanctions against him, said Zhou Bo, a retired officer of the People's Liberation Army.
Gen Li was sanctioned in 2018 over the acquisition of military hardware from Russia. His five-year term as defence minister started earlier this year, but the sanctions prevent him from travelling to the US, and also make it difficult for him to invite Gen Austin to China, Mr Zhou added.
"If the sanction is there, how can we talk? The sanctions are very much consequential," said Mr Zhou, now a senior fellow at Tsinghua University's Centre for International Security and Strategy in Beijing.
Senior intelligence officials attended a meeting of spy chiefs at the Singapore summit, according to Reuters.
Despite the diplomatic spat, a top US state department official has arrived in Beijing for a week of wide-ranging talks.
At the White House on Monday, National Security Council spokesman John Kirby said that the US believes it is important to maintain communications channels with China despite its military showing an "increasing level of aggressiveness"
Relations between Washington and Beijing have been strained in recent years over several issues, including China's claim over Taiwan, and territorial disputes in the South China Sea.
A senior PLA official, Lt Gen Jing Jianfeng, said there was no room for compromise on Taiwan, as he accused the US of meddling in the region.
Washington's decision to increase the number of troops on rotational deployment in the region could heighten the risk of a confrontation, he told reporters on the sidelines of the summit.