Australia plans to lobby the United Nations Security Council to take "swift and effective" action against North Korea and will "advocate a UN Security Council regime against the DPRK (North Korea) which includes targeted financial and travel sanctions, other trade restrictions and or aviation restrictions," Mr Howard told parliament.
"Australia will also actively promote with other like-minded countries a concerted strong international response through key regional mechanisms such as APEC and the ASEAN regional forum."
Mr Howard also strongly condemned the test, saying that North Korea was mistaken if it thought that a nuclear test would improve its bargaining power.
"The test has destabilised the region, its eroded North Korea's own security," he said.
"A strong international response is called for and Australia will give full support to that response."
Mr Howard said developments with North Korea would be a significant test for the UN.
"If the United Nations is to come up to scratch on this issue... it will win great respect and an enhanced reputation, but if the United Nations fails to act effectively against this outrage from North Korea it will represent a further diminution of its authority."
Mr Howard described it as outrageous that North Korea relied on the international community to feed its starving population while devoting scarce resources to nuclear programs.