Taiwan on Wednesday expressed regret at embarrassing its chief ally the United States after a Taiwanese flag-raising ceremony in Washington sparked US criticism and Chinese anger.

Taiwan's flag was raised over its de facto embassy in Washington on New Year's Day for the first time since the US switched diplomatic recognition from Taipei to Beijing in 1979.

US State Department spokeswoman Jen Psaki said Tuesday the US was "disappointed with the action" which violated a long-standing pact on US-Taiwan ties, and that it had not been informed in advance of the ceremony.

The United States has long held a one-China policy, and does not have full diplomatic relations with Taiwan, the self-ruled island Beijing still claims as part of its territory.

Washington has a representative office in Taipei, while Taiwan maintains representation at a luxury estate in the US capital known as Twin Oaks.

China said it "resolutely opposed" the flag-raising and had lodged "solemn representations" with the US.

"The Chinese side requests the American side to adhere to the one-China policy and the principles established by the three China-US joint communiques, act with discretion when dealing with Taiwan-related issues and avoid the recurrence of a similar incident," said foreign ministry spokeswoman Hua Chunying on Monday.

China hoped the US "will not allow a similar incident to occur again", foreign ministry spokesman Hong Lei added at a regular briefing Wednesday.

"This is an isolated incident. We regret that it caused the US inconvenience," Taiwan's deputy foreign minister Andrew Kao told a parliamentary session Wednesday.

"We have an understanding (with the US) and we will continue to enhance communication."

De facto ambassador Shen Lyu-shun, who made the decision to raise the flag, was subject to fierce grilling in the session but defended the move.

"There is no setback in relations," Shen said.

"The US understood that we did not notify them in advance out of goodwill... so the US wouldn't be in a difficult position if China lodged a protest."

It is a tradition in Taiwan to hold a flag-raising ceremony on January 1 to mark the founding day of the Republic of China, the island's formal name.

"Republic of China is a sovereign country... as the representative of the Republic of China to the United States I think raising the flag on New Year's Day is what we should do," Shen said.

- 'Diplomatic incident' -

Kao admitted that Taiwan's foreign ministry had not been aware of the ceremony in advance, but said it respected and supported Shen's decision.

Other lawmakers expressed anger.

"You (Shen) did this for your own credit and caused a diplomatic incident and setback in relations," said lawmaker Chen Ming-wen of the opposition Democratic Progressive Party.

Some however blamed Beijing for "suppressing" Taiwan by protesting at the flag-raising.

"The problem is with China's foreign ministry which didn't think clearly and respect our space in the international community," said lawmaker Lee Tung-hao.

Tung Chen-yuan, a political science professor at National Chengchi University, said the isolated incident "will not affect Taiwan's overall relations with the US or China".

"The US did not approve of this but it also said ties with Taiwan remained stable," Tung said. "The US and China made clear their political stances but it doesn't look like they will make any follow-up moves."

Taiwan and China split in 1949 after a civil war although Beijing still claims sovereignty over the island.

Ties have improved markedly since Taiwan's President Ma Ying-jeou took office on a Beijing-friendly platform in 2008, but diplomatic issues remain a sensitive area.