Reclusive North Korea said at the weekend it was ready to sink the US aircraft carrier, the USS Carl Vinson, which Mr Trump had ordered to waters off the Korean peninsula as a warning to the nuclear-armed North.
Japan said on Sunday it had sent two Japanese destroyers to join the carrier group for drills, and South Korea said it was also in talks about holding joint naval exercises.
China is increasingly worried the situation may spin out of control, leading to war and a chaotic collapse of its isolated and poverty-struck neighbour.
Mr Xi told Mr Trump that China resolutely opposes any actions that run counter to UN Security Council resolutions, a Chinese foreign ministry statement said.
China 'hopes that all relevant sides exercise restraint, and avoid doing anything to worsen the tense situation on the peninsula', the statement paraphrased Mr Xi as saying.
The nuclear issue can only be resolved quickly with all relevant countries pulling in the same direction, and China is willing to work with all parties, including the United States, to ensure peace, Mr Xi said.
Tensions have risen sharply in recent months, with Washington and its allies fearing Pyongyang could conduct another nuclear missile test or launch more ballistic missiles in defiance of United Nations sanctions.
North Korea celebrates the 85th anniversary of the foundation of its Korean People's Army on Tuesday, and has marked similar events in the past with nuclear tests or missile launches.
Earlier, Japanese Prime Minister Shinzo Abe described his conversation with Mr Trump as a 'thorough exchange of views'.
"We agreed to strongly demand that North Korea, which is repeating its provocation, show restraint", Mr Abe told reporters.
Mr Abe also said he and Mr Trump agreed that China, North Korea's sole major ally, should play a large role in dealing with Pyongyang.
A Japanese official said the phone call between Mr Trump and Mr Abe was not prompted by any specific change in the situation.
The US government has not specified where the carrier strike group is, but US Vice President Mike Pence said on Saturday it would arrive 'within days'.
South Korean Defence Ministry spokesman Moon Sang-gyun gave no further details about the South's plans, other than saying Seoul was holding discussions with the US Navy.
"I can say the South Korean and US militaries are fully ready for North Korea's nuclear test," Mr Moon said.
South Korean and US officials have feared for some time that North Korea could soon carry out its sixth nuclear test.
Satellite imagery analysed by 38 North, a Washington-based North Korea monitoring project, found some activity under way at North Korea's Punggye-ri nuclear test site last week.
However, the group said it was unclear whether the site was in a 'tactical pause' before another test or was carrying out normal operations.
Adding to the heightened tensions, North Korea detained a US citizen on Saturday as he attempted to leave the country.
(Reporting by Ben Blanchard and Ju-min Park, Additional Reporting by Takashi Umekawa and Linda Sieg in Tokyo, James Pearson in Seoul, Philip Wen in Beijing, and Steve Holland in Washington, Editing by Paul Tait)
Get the latest election news, live updates and election schedule for Lok Sabha Elections 2019 on ndtv.com/elections. Like us on Facebook or follow us on Twitter and Instagram for updates from each of the 543 parliamentary seats for the 2019 Indian general elections.