South Korea's Yonhap news agency reported the North had fired two short-range missiles into the East Sea ahead of the start of military exercises by Seoul and Washington that have enraged Pyongyang.
"The situation on the Korean peninsula is again inching close to the brink of a war," the official KCNA news agency said, quoting a spokesman for the Korean People's Army (KPA).
"The only means to cope with the aggression and war by the US imperialists and their followers is neither dialogue nor peace. They should be dealt with only by merciless strikes."
North Korea regularly ratchets up hostile rhetoric at times of joint US-South Korea military exercises, which always spark a sharp surge in tensions on the divided peninsula.
The largest element of the drills is Foal Eagle, an eight-week exercise involving air, ground and naval field training, with around 200,000 Korean and 3,700 US troops.
A week-long, largely computer-simulated joint drill - Key Resolve - will also get underway.
Seoul and Washington insist the exercises are defence-based in nature, but they are condemned by Pyongyang as provocative rehearsals for invasion.
The KPA spokesman branded the exercises as "dangerous nuclear war drills for invading the DPRK (North Korea)" and "unpardonable war hysteria of dishonest hostile forces".
"Our revolutionary armed forces will never remain a passive onlooker to this grave situation," the KCNA report said, adding that North Korea would respond in kind to any conventional, nuclear or cyber act of war against it.
"In case even a single shell drops on any place over which the sovereignty of the DPRK is exercised, it will promptly take counteractions."
Although its nuclear program remains shrouded in uncertainty, Pyongyang is currently believed to have a stockpile of some 10 to 16 nuclear weapons fashioned from either plutonium or weapons-grade uranium.
A new research report by US experts published last month estimated that North Korea could be on track to have an arsenal of 100 nuclear weapons by 2020.
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