If the ground-based missile interceptor system comes into force, this will fill the third tier of missile defences in Japan, which already possesses Aegis destroyers equipped with interceptors and land-based Patriot Advanced Capability-3 interceptors.
A proposal to build two Aegis Ashore batteries was approved by Prime Minister Shinzo Abe's Cabinet on Tuesday.
Japan's government on Tuesday chose to beef up its missile defence systems to ward off the rising threat of Asian neighbour, North Korea, local media reported.
Defence officials say two Aegis Ashore units can cover Japan entirely and could cost around 200 billion yen ($2.5 billion NZD), though they have not released exact figures.
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The deployment will add to growing defence costs in Japan as Prime Minister Shinzo Abe's government pushes to allow the military a greater global role and boost its missile combat capability.
With the Aegis Ashore, "we will be able to defend our country on a sustainable basis and our ballistic missile defense capability will improve drastically", Defense Minister Onodera Itsunori said a news conference.
Billed as a "low-risk weapon system" similar to that of Aegis Afloat in the Lockheed Martin's arsenal, the interceptor missile tries to hit the incoming projectile on re-entry into the earth's atmosphere.
The country's Prime Minister Shinzo Abe has sided with U.S. President Donald Trump, who had warned that every option including military action, was on the table to deal with Pyongyang.
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The Palestinian people's heritage was intimately interwoven with that of the city and East Jerusalem was the capital of Palestine. Israeli Prime Minister Benjamin Netanyahu hailed Trump's decision, calling it "an important step towards peace".
Aegis Ashore is already operating in Romania with another system planned for Poland.
In 2017, North Korea fired two missiles over Japan and three intercontinental ballistic missiles on steep trajectories into the Sea of Japan.
The new Aegis stations may not come with a powerful radar, dubbed Spy-6, which is being developed by the United States.
Initial funding will be ring-fenced in the next defense budget beginning in April, but no decision has been made on the radar, or the overall cost, or schedule, of the deployment, a Ministry of Defence official said at a press briefing.
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Japanese defense officials also considered purchasing the Terminal High Altitude Area Defense (THAAD) system, another USA -built anti-missile system, but chose the Aegis Ashore due to its cost-effectiveness.