In a joint press conference, Chen said the pair had "found a lot of common ground", but that there were still "different opinions on certain issues," and accused Washington of spending "so much money on the military."
"I know the US is still recovering from the financial crisis, it still has some difficulties in its economy... Isn't it placing too much pressure on taxpayers?"
Mullen, however, later said on Twitter: "Good discussions with my Chinese counterpart. Will not agree on everything but now is the time to focus on those things we CAN agree on."
Vietnam and the US are to hold joint naval activities this month, with the latter again saying they are long-planned and unconnected to recent tensions.
China, the Philippines, Vietnam, Brunei, Malaysia and Taiwan have overlapping claims to parts of the South China Sea, which is believed to have vast oil and gas deposits, while its shipping lanes are vital for global trade.
Vietnam and the Philippines have in recent months accused Beijing of taking increasingly aggressive actions in staking its claims.
In May, Vietnam said Chinese marine surveillance vessels cut the exploration cables of an oil survey ship inside Hanoi's exclusive economic zone.
And Philippine President Benigno Aquino has accused China of inciting at least seven recent incidents, including one in which a Chinese vessel allegedly opened fire on Filipino fishermen.
In response, China has insisted it wants to resolve disputes peacefully but remains firm in its claims to most of the South China Sea, even waters within the Philippines' economic exclusion zone.
Speaking to reporters after arriving in Beijing on Sunday, Mullen said Washington was concerned about freedom of navigation, but suggested that the disputes would be "resolved peacefully".
With ties sometimes fraught between the two militaries, he stressed that the US was in no way seeking to contain China's dramatic rise, but said it would remain active in the Asia Pacific region for a long time.
Chinese Vice Foreign Minister Fu Ying, speaking in Hong Kong on Monday, meanwhile, said "diplomatic wisdom" between China, the Philippines and Vietnam was needed to "make sure that our differences will be contained".
Mullen is also expected to address rising tensions with North Korea and measures to boost security cooperation between China and the United States during his four-day trip.
He held talks Monday with China's vice president Xi Jinping, who is widely expected to take over as president next year, and will visit military bases in the eastern provinces of Shandong and Jiangsu on Tuesday. --
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