North Korea on Monday warned of "merciless firing" against the South if it goes ahead with a reported plan to develop shells to carry anti-Pyongyang leaflets across the border.

The South's Joong-Ang Ilbo newspaper reported last week that South Korean troops were developing non-explosive hollow shells capable of carrying such leaflets deep into North Korean territory. There has been no official confirmation.

South Korean activists including defectors from the North already regularly launch anti-Pyongyang leaflets across the border by balloon, despite the North's Korean threats to shell the "human scum" involved.

"This is another intolerable challenge to the DPRK (North Korea)," the Secretariat of the Committee for the Peaceful Reunification of Korea said in a statement carried by the North's official news agency.

"We will never tolerate the foolish act of the puppet warmongers but wipe out the provokers with merciless firing," the state body added.

"We will deal a telling blow at the (South Korean) army to make it pay a very high price for its foolish provocation as it is keen on staging 'psychological warfare against the North' in alignment with human scum," it said.

Tensions between the two Koreas had appeared to cool down after soaring in February, when the North carried out its third underground nuclear test in defiance of UN Security Council resolutions.

But relations have soured again in recent weeks, with the North stepping up its bellicose rhetoric after Seoul and Washington agreed a joint strategy to address what they call the mounting threat of a North Korean nuclear attack.