The panel will examine issues like the deadly anti-US fighting in Iraq and the failure to find weapons of mass destruction there, in a hearing that began in Washington DC just after 9am local time (1400 GMT).
With deadly chaos threatening Iraqi elections scheduled for January 30, Rice called the ballot "the next step in (Iraq's) journey towards full, genuine democracy" and urged all Iraqis to take part.
"All Iraqis, whatever their faith or ethnicity, from Shias to Sunnis to Kurds, must build a common future together. The election later this month will be an important first step," she said.
Her comments came after US President George Bush drew criticism during his first four years in office for what many saw as a go-it-alone approach to critical issues, from the environment to the war in Iraq.
Rice, currently Bush's national security adviser, made no apologies for the invasion to topple Saddam Hussein, saying US policies after the 11 September 2001 attacks were "difficult, and necessary, and right".
But her confirmation as successor to Colin Powell, who frequently clashed with hardliners in the Bush administration, did not seem in doubt.
Rice on Tuesday vowed to repair damaged relations with allies and work with other world powers to wage war on terrorism, declaring "the time from diplomacy is now".
"Our interaction with the rest of the world must be a conversation, not a monologue," Rice, 50, said in her prepared opening statement to the.
Rice called N Korea and five more
nations 'outposts of tyranny'
Referring to US allies in Europe and Asia, she insisted that "we must remain united in insisting that Iran and North Korea abandon their nuclear weapons ambitions, and choose instead the path of peace".
In her opening statement, Rice said democracy was spreading worldwide but named Belarus, Cuba, Iran, Myanmar, North Korea and Zimbabwe as "outposts of tyranny" to which the US must help bring freedom.
Rice said the US could not succeed alone but served notice that she would not let traditional allies or multilateral institutions stand in the way of "effective" action by Washington.
"Alliances and multilateral institutions can multiply the strength of freedom-loving nations," she said. "Yet when judging a course of action, I will never forget that the true measure of its worth is whether it is effective."
Rice laid out three major tasks ahead of US diplomacy: uniting democracies to build a world system "based on our shared values and the rule of law", helping democracies fend off common threats to security, and spreading freedom and democracy worldwide.
Russia and China
Rice, an expert on Washington's relations with Moscow, warned Russia against taking steps seen as curbing democracy - a growing concern in recent months amid Russo-US clashes on issues like Ukraine's flawed elections.
Democracy's success in Russia is
not yet assured, Rice cautioned
"In Russia, we see that the path to democracy is uneven and that its success is not yet assured. Yet recent history shows that we can work closely with Russia on common problems," he said.
"As we do so, we will continue to press the case for democracy, and we will continue to make clear that the protection of democracy in Russia is vital to the future of US-Russia relations."
Four years after Bush took office having defined China as a "strategic competitor", Rice said she sought "a candid, cooperative and constructive relationship with China that embraces our common interests but still recognises our considerable differences about values".