The United States has rejected the idea of making economic concessions to North Korea in exchange for a commitment to abandon its nuclear programme.
The North is reported to want substantial economic aid
White House spokesman Ari Fleischer said the US would not "reward North Korea for bad behaviour".
North Korea had earlier said nuclear talks with the US were pointless if Washington continued to insist Pyongyang first scrapped its suspected nuclear programme.
The comments come a day after US Secretary of State Colin Powell said Washington was reviewing Pyongyang's offer to give up its nuclear programme in exchange for substantial economic concessions.
We will not reward North Korea for bad behaviour. What we
seek is North Korea's irrevocable and verifiable dismantlement of its nuclear weapons programme
White House spokesman Ari Fleischer
Mr Powell said the offer was made during talks in Beijing between North Korean diplomats and their US counterparts last week.
Mr Fleischer said inducements would not be provided to North Korea for doing what the government in Pyongyang had always said it was going to do.
The spokesman said the diplomatic process with North Korea would be a lengthy one, but that US President George W Bush was prepared to pursue it.
In Pyongyang, South and North Korean officials say they have agreed to seek a peaceful resolution to the nuclear crisis on the Korean Peninsula.
In a joint statement, the officials say South and North Korea will thoroughly consult each other's position and will continue co-operation to resolve the issue through dialogue.
The inter-Korean talks had been scheduled to conclude on Tuesday, but they were extended because the two sides had failed to reach agreement on the wording of the statement.
The officials also agreed on another round of ministerial talks to be held in Seoul in July.
Colin Powell said on Monday that the North Koreans had used the Beijing talks to acknowledge "a number of things they were doing, and in effect, said that these are now up for further discussion".
"They did put forward a plan that would ultimately deal with their nuclear capability and their missile activities, but they of course expect something considerable in return," he said.
Oct 2002 - US says N Korea "admits" secret nuclear programme
Nov 2002 - US-led decision to halt oil shipments to N Korea
Dec 2002 - N Korea expels two nuclear watchdog's inspectors
Jan 2003 - N Korea says it is withdrawing from Nuclear Non-Proliferation Treaty
Feb 2003 - N Korea "restarts" Yongbyon nuclear plant
Apr 2003 - N Korea ends insistence on direct talks with US
Mr Powell did not specify exactly what the North Koreans were demanding, but reports suggested Pyongyang wanted normalised relations with the US and to receive substantial economic assistance.
In the past, the US it has made clear that it will not be blackmailed. State Department spokesman Richard Boucher said the US would not "pay for elimination of nuclear weapons programmes that never should have been there in the first
Mr Powell, however, insisted that the Beijing talks were "quite useful", and said Washington would discuss the North's proposals with America's allies.
He added that talks were now under way with nations including China, Russia, Japan and Australia.
The three-way talks last week in Beijing were the first high-level US-North Korean contact since the nuclear crisis erupted in October, when Washington accused Pyongyang of having a secret nuclear arms programme.
From the start of the inter-Korean talks in Seoul, both sides had been struggling to reach common ground, says the BBC correspondent in Seoul, Caroline Gluck.
The South Korean delegates made clear that their main aim is to seek an explanation from North Korea about its reported admission to US officials that it possessed nuclear weapons.
After the Beijing meeting, the US said Pyongyang had admitted to having nuclear weapons, as well as having started reprocessed 8,000 spent nuclear fuel rods - a key step in producing further weapons.
North Korea has yet to state this assertion publicly.
South Korean President Roh Moo-hyun has pledged to continue his predecessor Kim Dae-jung's policy of engaging North Korea.
But while stressing the need for continued dialogue and denying the need for sanctions, Seoul has repeatedly said it will never accept its neighbour possessing nuclear capabilities.