South Korea's two-stage Naro rocket lifted off on Tuesday from an island off the south coast.
The satellite was placed into orbit but was not following its intended course, according to Science and Education Minster Ahn Byong-man.
"All aspects of the launch were normal, but the satellite exceeded its planned orbit," he was quoted as saying.
The satellite had reached an altitude of 360km (225 miles), rather than separating at the intended 302km, he said.
South Korean and Russian scientists were investigating the problem, he added.
Experts at the Korea Aerospace Research Institute were cited by local media as saying they were trying to track the satellite.
A statement from the science ministry called the launch a "partial success", while South Korean President Lee Myung-bak called it a "half-success".
Excited crowds gathered to watch Tuesday's launch
The rocket - 33m (108 ft) long and weighing some 140 tonnes - was the country's half-a-billion dollar bid to join the exclusive club of spacefaring nations.
Its Russian liquid-fuelled first-stage was said to have 1,700 kilonewtons of thrust at launch.
The second stage, burning a solid fuel, was produced by South Korean engineers.
Generating 80kN of thrust, it was intended to carry the Earth observation satellite into its final orbit.
South Korea initially planned to launch the rocket in late July, but delayed it several times due to technical problems.
South Korea has previously sent satellites into space using launch vehicles and rockets from other countries.
Seoul has rejected any comparison with Pyongyang's rocket launch and says its rocket is part of a peaceful civilian space programme.
But some security analysts have suggested a commercial space programme could still alter the long-term strategic balance in the region, as all rocket technology has potential military uses.
No North Korean satellite has been detected in space, although Pyongyang insists its rocket launch worked and the device is now orbiting the earth transmitting revolutionary melodies.
This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.
Bookmark with:
What are these?