The operation was the latest attempt to counter what Washington sees as the country's efforts to limit freedom of navigation in the strategic waters. In retaliation for the deployment, the Pentagon last week rescinded an invitation for China to participate in a multinational naval exercise this summer near Hawaii.
Despite the naval drill being planned months in advance it comes at a sensitive time as the Pentagon had uninvited China from a major US-hosted naval drill.
A statement on the Defence Ministry's website said the Arleigh Burke class guided-missile destroyer USS Higgins and Ticonderoga class guided-missile cruiser USS Antietam entered waters China claims in the Paracel island group "without the permission of the Chinese government".
They carried out maneuvering-operations near Tree, Triton and Woody islands.
Critics of the operations, known as a "freedom of navigation", have said that they have little impact on Chinese behavior and are largely symbolic.
The U.S. military does not comment on the specifics of what it calls "freedom of navigation" exercises meant to assert the Navy's right to sail and operate in any zone deemed legal under global law.
"We conduct routine and regular freedom of navigation operations, as we have done in the past and will continue to do so in the future", the US Pacific Fleet said in a statement.
It said the Chinese military "immediately dispatched warships to identify and inspect the American ships according to law, and warned them to depart".
It claimed the U.S. had entered the country's territorial waters without permission.
Changes to data protection laws
It has become a necessary public relations move for the company, which is still struggling to regain user trust. By contrast, it took Yahoo more than two years to reveal a breach that ultimately involved three billion users.
In another statement by China's Foreign Ministry, it told the U.S. to stop such military exercises.
'China will continue to take all necessary measures to defend the country's sovereignty and security, ' it added, without elaborating.
The move signals USA rejection of China's claims of political control in the South China Sea.
China's claims in the South China Sea, through which about $5 trillion (3.75 trillion pounds) in shipborne trade passes each year, are contested by Brunei, Malaysia, the Philippines, Taiwan and Vietnam.
China has been deploying serious military power to the region - including constructing manmade islands bristling with missiles.
China's island-building programme in the South China Sea has sparked concern around the region and in Washington about Chinese intentions.
The operation was conducted just over a week after Beijing flew nuclear-capable bombers to a disputed island in a bold powerplay to show its military might and boost its territorial claims in the area.
"China's continued militarization of disputed features in the South China Sea only serve to raise tensions and destabilize the region", a Pentagon spokesman, Marine Lt. Col. Christopher Logan, said.
It also follows the United States' decision to disinvite the Chinese People's Liberation Army-Navy from the 2018 iteration of the Rim of the Pacific exercise.