Australia's foreign minister believes the United States will find "new and creative" ways to deal with North Korea.
US President Donald Trump has said all options, including military action, are on the table to prevent North Korea from achieving nuclear weapons capability.
"It means the Trump administration will seek out new and creative ways to meet the North Korean challenge," Ms Bishop told ABC radio on Tuesday.
"We certainly support the right of our allies and friends to ensure their interests are protected and their citizens defended against any possible attack."
Ms Bishop said the North Korean threat to regional and global peace had increased.
"Any rise in tensions is entirely due to the provocative behaviour of North Korea," she said.
The Turnbull government believes leader Kim Jong Un has a clear ambition to develop an intercontinental ballistic missile capable of reaching the US, meaning Australia would also be within reach.
"Unless it is prevented from doing so it will be a serious threat to the peace and stability of our region and this is unacceptable," Ms Bishop said.
The foreign minister also reiterated calls for China to use its unique and potentially decisive leverage against the North Korean regime.
"We believe there is more China can do in terms of sanctions and other economic efforts."
Ms Bishop also warned that Australia could be at risk of attack if North Korea's progressive weapons program continued.
"[North Korea] is on a path to achieving nuclear weapons capability and we believe Kim Jong-un has a clear ambition to develop an intercontinental ballistic missile capable of carrying a nuclear payload as far as the US," she said.
"That would mean Australia would be in reach so unless it is prevented from doing so it will be a serious threat to the peace and stability of our region and that is unacceptable."
