South Sudanese forces this week seized control of Heglig in Sudan. The conflict comes as both sides draw closer to war over disputes over oil and border territories.
British Minister for African Henry Bellingham warned both countries against making a tense situation worse.
"The move by the South Sudanese armed forces to occupy Heglig in Sudan is completely unacceptable, as are the continuing bombings of South Sudanese territory by Sudan," he said in a statement. "I condemn all such actions which threaten economic stability and the livelihoods of ordinary people in Sudan and South Sudan."
A brutal civil war in Sudan culminated with South Sudan's independence in July, though the peace agreement that brokered the truce remains fragile.
U.N. Secretary-General Ban Ki-moon called for an immediate presidential summit between both sides and urged both parties to pull forces back.
South Sudanese President Salva Kiir, in a statement published by the independent Sudan Tribune, said he wasn't following orders from the United Nations.
"I am a head of state accountable to my people and do not have to be ordered by someone I do not fall under his direct command," he said. "I will not withdraw the troops."