It comes amid speculation that the current leader, Kim Jong-un, could order another nuclear test.
The officials are hopeful China and Russian Federation would agree to tighter United Nations sanctions on North Korea if it conducts another nuclear test.
The show of strength comes amid mounting tension, with a U.S. aircraft carrier group steaming towards the region.
"We will respond to an all-out war with an all-out war and a nuclear war with our style of a nuclear attack", said Choe Ryong Hae as translated by the BBC.
As Panetta said: "We have the potential for a nuclear war that would take millions of lives".
North Korea holds a military parade at Kim Il Sung Square in Pyongyang on April 15, 2017, as it marked the 105th anniversary of its founding leader's birth.
He saluted an honour guard and took his place on the podium.
Kim Jong Un, looking relaxed in a dark suit and laughing with aides, oversaw the festivities on the "Day of the Sun" at Pyongyang's main Kim Il Sung Square.
But the incoming military chief has raised concerns over access to key equipment - including the force's limited number of amphibious landing vehicles.
The state TV also showed several KN-08 missiles being rolled out on trucks at the parade. North Korea had previously launched the ballistic missile into the Sea of Japan during the summit between President Donald Trump and Japan Prime Minister Shinzo Abe in February.More news: Augmented reality will be Facebook's next big push, starting with smartphone cameras
Other military hardware at the parade included tanks, multiple rocket launchers and artillery guns, as well as a solid-fuel missile created to be fired from submarines.
The event made clear how vital the state's nuclear programme is to its future ambitions as it continues to ignore growing pressure from the U.S. to abandon its nuclear weapons programme. North Korea also launched a long-range rocket a year ago that put a satellite into orbit, which Washington, Seoul and others saw as a banned test of missile technology.
Speculation that it could conduct a sixth blast in the coming days to coincide with the anniversary has reached fever pitch, with specialist United States website 38North describing its Punggye-ri test site as "primed and ready" and White House officials saying military options were "already being assessed". During a press conference in Beijing on Friday, the Chinese foreign minister, Wang Yi, pleaded for Washington and Pyongyang to "refrain from provoking and threatening each other, whether in words or actions, and not to let the situation get to an irreversible and unmanageable stage".
China is seeking Russia's help to cool tensions.
Meanwhile, Vice President Pence is traveling to South Korea this weekend.
His comments come as a nuclear-armed USA naval battle group, centred on the nuclear-armed USS Carl Vinson mega-carrier, prepares to take up station off the Korean Peninsula and the United States and South Korea stage their largest-ever war games.
"What we've seen already is that it's a very large parade".
Since taking power in late 2011, Kim Jong Un has executed or purged a slew of high-level government officials in what the South Korean government has described as a "reign of terror".
Han, however, said North Korea blames Trump and the USA for the rising tensions.