The US Navy conducted a "freedom of navigation exercise" around Triton Island in the Paracel archipelago, which is claimed by China, Vietnam and Taiwan.
As part of the exercise, the guided-missile destroyer USS Stethem came within 12 miles of Triton, sailing into what China claims to be its territorial waters. The US does not recognize Beijing's claim of sovereignty over the islands, which it has occupied and on which it has been building fortifications.
The Pentagon declined to comment on the exercise.
"Beijing has undertaken substantial upgrades of its military infrastructure in the Paracels," according to the Washington-based Center for Strategic and International Studies' Asia Maritime Transparency Initiative.
The initiative also says China has recently expanded its facilities on Triton Island to include the construction of a helipad.
The top US commander in the Pacific, Adm. Harry Harris, told an audience in Australia on Wednesday that "Fake islands should not be believed by real people," in reference to China's land reclamation activities.
"I believe the Chinese are building up combat power and positional advantage in an attempt to assert de facto sovereignty over disputed maritime features and spaces in the South China," Harris added.
A spokesman for the US Pacific Fleet, Lt. Cmdr. Matt Knight, could not confirm Sunday's exercise but told CNN they are a routine part of US Navy operations. The "excessive maritime claims" of 22 countries were challenged in the past fiscal year, he said.
A statement from the Chinese Ministry of Foreign Affairs said the US had "trespassed" and that China sent "military vessels and fighter planes in response to warn off the US vessel."
China called the action "a serious political and military provocation." The US "stirs up trouble" and runs "in the opposite direction from countries in the region who aspire for stability, cooperation and development," the ministry statement said.
Sunday's exercise, which was first reported by Fox News, comes days after the Trump administration made a number of moves that appeared to irk Beijing, including sanctions against Chinese entities doing business with North Korea and the approval of a new arms sale to Taiwan.
Sunday's operation was the second reported under the Trump administration.
The first came on May 24, when the guided-missile destroyer USS Dewey sailed within 12 miles (20 kilometers) of Mischief Reef in the Spratly Islands chain, which lies to the south of the Paracels.
After that operation, China's defense ministry said two Chinese frigates had "warned and dispelled" the USS Dewey after it had entered its waters "without permission."
"We firmly opposed to the US behavior of showing force and boosting regional militarization, and have made solemn representation to the US side," Defense Ministry spokesman Ren Guoqiang said at the time.
Last week, a report from the Asia Maritime Transparency Initiative said China is continuing to build up infrastructure on three islands in the Spratly chain, Fiery Cross, Mischief and Subi reefs.
The newest buildings include shelters for missile launchers on Fiery Cross Reef and a very large antenna array on Mischief Reef, the AMTI report said.
Radar domes have recently been completed or are under construction around both Fiery Cross and Mischief, AMTI reported.
It also said large underground storage areas are being built on the reefs, presumably to store munitions, it said.
The group posted satellite pictures to support its report.
In late March, AMTI reported that dozens of aircraft hangars and high-end radar capabilities on the man-made islands in the South China Sea were almost operational.
Experts told CNN the new facilities will further establish China's military dominance over the region and could help China establish a controversial Air Defense Identification Zone in the area.