The US and China played down their differences over the oil and gas-rich waters of the South China Sea at a meeting on Friday.
On the sidelines of Asia’s biggest security conference in Bali, US Secretary of State Hillary Clinton praised Beijing for agreeing to new conduct guidelines for the sea, over which China claims it has undisputable sovereignity.
Commentators said Clinton was keen her meeting with Chinese Foreign Minister Yang Jiechi would not become another source of friction between the two powers.
The dispute is seen as an important test case because Taiwan, the Philippines, Vietnam and Malaysia also claim territory in the South China Sea.
Relations between the US and China have also been strained over the decision by the White House to invite the Dalai Lama to meet President Obama.
Beijing views the Tibetan spiritual leader, who made a 13 day visit to the US, as a violent seperatist.