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The BBC's Lucy Williamson: "North Korea and America are in a kind of 'who blinks first' game"
North Korea has said it is entering a "state of war" with South Korea in the latest escalation of rhetoric against its neighbour and the US.
A statement promised "stern physical actions" against "any provocative act".
North Korea has threatened attacks almost daily after it was sanctioned for a third nuclear test in February.
However, few think the North would risk full-blown conflict. It has technically been at war with the South since 1953 as no peace treaty has been signed.
An armistice at the end of the Korean War was never turned into a full treaty.
'Taking threats seriously'The North carried out its third nuclear test on 12 February, which led to the imposition of fresh sanctions.
The annual US-South Korean military exercises have also taken place, angering Pyongyang further.
Timeline: Korean tensions
- 12 Dec: North Korea fires three-stage rocket, in move condemned by UN as banned test of long-range missile technology
- 12 Feb: North Korea conducts an underground nuclear test, its third after tests in 2006 and 2009
- 7 Mar: UN approves fresh sanctions on Pyongyang; North Korea says it has the right to a "pre-emptive nuclear strike" on the US
- 11 Mar: US-South Korea annual joint military drills begin; North Korea says it has scrapped the Korean War armistice (the UN says the pact cannot be unilaterally scrapped)
- 19 Mar: US flies B-2 nuclear-capable bombers over Korean peninsula, following several North Korean threats to attack US and South Korean targets
- 20 Mar: Broadcasters and banks in South Korea hit by cyber attack, the origin of which remains unknown, days after North Korea says some of its sites were hacked
- 27 Mar: North Korea cuts military hotline with South, the last official direct link between the two
- 28 Mar: US flies stealth bombers over Korean peninsula; showcasing ability for precision strike "at will"
- 30 Mar: North Korea says it is entering a "state of war" with South Korea
Many analysts believe that all-out war with South Korea and its ally the United States would be suicidal for the North, says the BBC's Lucy Williamson in Seoul.
But with both sides threatening heavy retaliation, there's a chance of minor incidents escalating, our correspondent adds.
A North Korean statement released on Saturday said: "From this time on, the North-South relations will be entering the state of war and all issues raised between the North and the South will be handled accordingly.
"The long-standing situation of the Korean peninsula being neither at peace nor at war is finally over."
In Washington, Caitlin Hayden, a spokeswoman for the National Security Council, said the US had "seen reports of a new and unconstructive statement from North Korea".
"We take these threats seriously and remain in close contact with our South Korean allies," she said.
North Korea has made multiple threats against both the US and South Korea in recent weeks, including warning of a "pre-emptive nuclear strike" on the US and the scrapping of the Korean War armistice.
On Thursday, North Korean state media reported leader Kim Jong-un "judged the time has come to settle accounts with the US imperialists".
He was said to have condemned US B-2 bomber sorties over South Korea during military exercises as a "reckless phase" that represented an "ultimatum that they will ignite a nuclear war at any cost on the Korean peninsula".
US mainland and bases in Hawaii, Guam and South Korea were all named as potential targets.
State media in the North showed thousands of soldiers and students at a mass rally in Pyongyang supporting Kim Jong-un's announcement
North Korea's most advanced missiles are thought to be able to reach Alaska, but not the rest of the US mainland.
'Unilateral action'White House spokesman Josh Earnest said the rhetoric only deepened North Korea's isolation.
China, North Korea's biggest trading partner, has reiterated its call for all sides to ease tensions.
"Start Quote
End Quote Professor John Delury, Yonsei universityWhen you look at occasions where something really did happen, such as the artillery attack on a South Korean island in 2010, you see there were very clear warnings"
Foreign ministry spokesman Hong Lei told a daily news conference that "joint efforts" should be made to turn around a "tense situation".
Russian Foreign Minister Lavrov went further, voicing concern that "we may simply let the situation slip out of our control".
"We are concerned that... unilateral action is being taken around North Korea that is increasing military activity," he said.
On 16 March, North Korea warned of attacks against South Korea's border islands, and advised residents to leave the islands.
In 2010, it shelled South Korea's Yeonpyeong island, causing four deaths.
On Wednesday, Pyongyang also cut a military hotline with the South - the last direct official link between the two nations.
A Red Cross hotline and another line used to communicate with the UN Command at Panmunjom have already been cut, although an inter-Korean air-traffic hotline still exists.
The jointly run Kaesong industrial park is still in operation.
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