South Korea and the United States are close to agreement on more than doubling the range of Seoul's ballistic missiles to better guard against threats from North Korea, a report said on Sunday.

Yonhap news agency said the two allies were close to agreeing on expanding Seoul's missile range to 800 kilometres (500 miles) -- enough to cover the entire North -- from the current 300 kilometres, citing diplomatic sources.

The United States stations 28,500 troops in South Korea and guarantees a nuclear "umbrella" in case of any atomic attack. In return, Seoul accepts limits on its missile capabilities.

"Agreements have been reached on major issues," said a Seoul source quoted by Yonhap. Another source said the two nations were only "hammering out details" on the deal to expand the range previously agreed in 2001.

The new limit on the missile range will likely be announced next month, Yonhap added. Seoul's defence ministry spokesman was not immediately available for comment.

President Lee Myung-Bak said in March the North's missiles could reach the southern island of Jeju, more than 400 kilometres south of the border, and stressed that Seoul needed a "realistic adjustment" to its own missile range.

The need to strengthen Seoul's missile capability took on new urgency after the impoverished but nuclear-armed North's latest long-range rocket launch in April, which rattled Pyongyang's neighbours but ended in failure.

Pyongyang insisted its aim was only to put a satellite into orbit but the United States and its allies saw it as a disguised long-range missile test banned under UN resolutions.

The two Koreas have remained technically at war since the 1950-53 Korean War ended with an armistice rather than a peace treaty.

The South believes the North has 1,000 missiles of various types, many of them targeted at Seoul or other locations in the South.