Lippert, 42, was in stable condition after undergoing more than two hours of surgery following the attack in which he was slashed on the face and wrist.
North Korea quickly called the stabbing a "knife attack of justice," and said it reflected "anti-U.S. Sentiment" in South Korea.
Pyongyang called the attack "just punishment for US warmongers," according to its official news agency, KCNA.
"This incident is not only a physical attack on the US ambassador, but an attack on the South Korea-US alliance and it can never be tolerated," she said.
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Lippert will likely remain hospitalised for three to four days, Dr Jung Nam-shik at Yonsei Severance Hospital in Seoul said.
Police identified the suspect as Kim Ki-Jong, a 55-year-old man with a history of unpredictable behaviour.
Kim attacked Lippert while screaming a slogan in favour of reunifying the divided Korean peninsula and later also shouted his opposition to joint US-South Korean military exercises that began on Monday.
The suspect wrestled the ambassador to the ground and slashed him with a knife, leaving the envoy bleeding profusely and his hands and clothes smeared in blood. It took 80 stitches to close his facial wound.
There was no request from the US Embassy for security at the event, Seoul police said. There were three police officers on duty at the entrance and 15 more on standby, police said.
"When the man jumped on the ambassador, I stood up and jumped on the man and they both fell on the ground," a witness, Jang Yoon Seok told CNN affiliate YTN. "Luckily I got on top of the man's back and could press him to the floor. Then others came to hold him on the floor."
Jang said he later saw the knife on the table, which had a wooden handle and did not look like a sophisticated weapon. Seoul police said a knife, about 10 inches long, was used in the assault and the suspect brought it from home.