The US move "seriously infringed on China's sovereignty and security," the military said, Reuters reported.
"It is yet another iron proof of its navigation hegemony and militarization of the South China Sea," it said, adding its troops would stay on high alert and safeguard national security.
The US Navy claimed in a statement the destroyer asserted navigational rights and freedoms in the South China Sea near the Paracel Islands "consistent with international law."
The USS Halsey exited the area after its operation and continued on in the South China Sea, the statement said.
The latest dispute between China and the US came amid heightened tensions in the strategic South China Sea, with US ally the Philippines embroiled in a bitter diplomatic row with Beijing over disputed waters in the region.
China claims large swaths of the South China Sea, including parts claimed by the Philippines, Vietnam, Indonesia, Malaysia and Brunei.