North Korea's armed forces minister, Kim Yong-chun, says his country is prepared to launch a sacred war against South Korea.
Speaking at a military rally in Pyongyang, Mr Kim said the North is willing to use its nuclear capabilities if attacked by the South.
He says preparations are under way for a war at any moment, to counter what he describes as the enemy's intentional drive to push the situation to the brink.
South Korea staged a large-scale land-and-sea military exercise close to the frontier with North Korea on Thursday. One of the largest in South Korea's history, it involved tanks, helicopters and fighter planes.
Afterwards, South Korean President Lee Myung-bak said he would order a merciless counter-attack against any aggression from the north.