China has strongly attacked Taiwanese President Chen Shui-bian, accusing him of endangering regional security.
A Chinese spokesman gave the country's first official response
In its first direct response to Mr Chen's inauguration speech last week, China warned that peace between Beijing and Taipei was in danger.
China said it would safeguard the island's sovereignty and territorial integrity at any cost, even militarily.
China views Taiwan as part of its territory, and has threatened to invade if Taiwan declared independence.
In his inauguration speech, President Chen called for better relations with Beijing, and said he would keep Taiwanese independence off the political agenda during efforts to draw up a new constitution.
The United States described his address as "responsible and constructive".
But on Monday, a spokesman for Beijing's Taiwan Affairs Office criticised Mr Chen for refusing to concede that Taiwan was a part of "one China".
"Chen Shui-bian has shown no sincerity to improve
relations," said spokesman Zhang Mingqing.
The content of the whole speech was about Taiwan's status as an independent country, he said.
China would "pay any price" to safeguard its territory, he added. "We will thoroughly crush schemes for Taiwan independence."
Asked if China would risk imperilling the 2008 Beijing Olympics, he said: "Some people are asking will the Olympic Games be influenced. If Chen Shui-bian dares to challenge the people of the
world... we will safeguard our sovereignty and territorial
integrity at any cost".
The rhetoric was harsh but not unexpected, according to the BBC's Taiwan correspondent, Chris Hogg.
Last week, Beijing made its views plain even before President Chen stood up to deliver his acceptance speech for his second term in office.
In a strongly-worded statement, it warned that any moves towards independence would be crushed, although analysts saw some hints of flexibility in Beijing's position.
This latest warning from China proves that the peril affecting peace and stability in the region still exists, our correspondent says.
There was no immediate response from Taipei, but the island's sometimes jittery stock market remained calm - a reflection, perhaps, that such threats by the mainland are not unusual nor unexpected.