The missile was launched from Sunan, close to the North Korean capital of Pyongyang, and flew around 1,680 miles (2,700km). Experts believe it to be the first which is powerful enough to potentially carry a nuclear warhead.
Early analysis suggests the missile was probably an intermediate-range Hwasong-12, and its maximum altitude of around 342 miles (550km) was lower than most previous North Korean tests.
After flying over Japan’s northernmost main island the missile broke into three pieces before falling into the sea around 733 miles (1,180km) off the east coast of Japan.
Japan did not try to shoot down the missile but issued a warning telling citizens in Hokkaido to take shelter in “a sturdy building or basement”.
Tuesday morning’s launch was the third North Korean missile to have passed over Japanese territory, with the first in 1998 and the second in 2009.
It passed over Japan at around 6:06am local time before breaking into three pieces, officials in Tokyo said.
South Korean President Moon Jae-in ordered a show of “overwhelming” force in response to the launch and four South Korean jets staged a live bombing drill on Tuesday.
Mr Moon’s chief press secretary, Yoon Young-chan, confirmed the drill was ordered by the South Korean military after an urgent National Security Council meeting.
He added: “We assessed North Korea’s provocations as extremely severe and decided to maintain a vigilant posture in preparation for the possibility of additional provocations by North Korea.”
Japan’s Prime Minister Shinzo Abe said on Tuesday he would do all in his power to protect the Japanese public after the missile test.
As he entered his office for an emergency meeting, Mr Abe told reporters: “We will make utmost efforts to firmly protect the lives of the people.”
And Japan’s chief Cabinet Secretary Yoshihide Suga described the test as an “unprecedented, grave threat”.
Local resident Hiroyuki Iwafune described the moment the alarm was raised.
He said: “I was surprised that it went above our area. This has never happened before.
“I was worried. Everyone felt the same. But what can you do? Hide? But where? We called those who were at sea. But then they said, ‘Even with this, what are we supposed to do?’”
One train operator explained a delay with the message: “All lines are experiencing disruption. Reason: ballistic missile launch.”
Warnings also played out at subway stations, where some people took shelter.
People across Japan were sent terrifying text message warnings which alerted them to the missile launch.
The message said: “Missile passing. Missile passing.
“A short time ago, a missile apparently passed above this area. If you find suspicious objects, please don’t go near them and immediately call police or firefighters. Please take cover in secure buildings or underground.”