South Korean Defense Minister Kim Kwan-jin said his country reserved the right to respond with military action should forces from North Korea attack in response to a propaganda campaign planned along the border.
"We will completely destroy the source of attack," he was quoted by China's official Xinhua news agency saying. Pyongyang, for its part, said it would conduct a "merciless military strike" against anti-government activists near the border.
Xinhua reports that South Korean activists are planning to drop anti-government leaflets over North Korea next week.
The South Korean Defense Ministry in July said troops along the border discovered leaflets along the border that carried statements blasting alleged attempts to destroy a statue of late North Korea leader Kim Il Sung.
In 2000, both sides agreed to halt psychological operations near the border and, in 2004, both governments pulled down propaganda along the shared border.
Tensions in the Korean Peninsula have intensified since Kim Jong Un took control over the country after the December death of his father, Kim Jong Il. A visiting U.S. diplomat this week warned North Korea that any provocative acts would be counterproductive.