The annual air, land and sea exercises, which the U.S. military characterized as "entirely defensive in nature," were assailed by the North Sunday as warmongering.
Pyongyang said it would respond with an "unprecedented all-out war" if it felt provoked by the exercises, "engulfing Seoul in a sea of flames," North Korea's state-run Korean Central News Agency reported.
The North also vowed to fire across the border at those sending helium balloons carrying anti-North Korean messages into the country.
South Korea this month floated about 2.5 million balloon messages ridiculing North Korean leader Kim Jong Il and calling for people in the North to rise up against his regime.
The large balloons -- each containing thousands of leaflets, cassette tapes and DVDs -- also included video coverage of the populist Middle East and North Africa uprisings and included a message that people are rejecting dictatorships and dynastic succession, The New York Times reported.
Kim, the Communist world's only hereditary leader, is grooming his youngest son, Kim Jong Un, as his heir apparent.
The North condemned the balloon campaign as "a treacherous deed and a wanton challenge" to peace on the Korean Peninsula. Further balloon lofts would result in "direct fire" by North Korean army units, it said.
The South Korean-U.S. military exercises -- Key Resolve and Foal Eagle -- will run until April 30.
One exercise will include a U.S. aircraft carrier, South Korea's publicly funded Yonhap News Agency reported. U.S. military officials neither confirmed nor denied this.
North Korea often issues stern warnings before South Korean military drills, but tensions are high after two South Korean civilians and two South Korean marines were killed in Nov. 23's shelling of the South's Yeonpyeong Island near the Yellow Sea border and 46 South Korean sailors were killed in the March 26 sinking of the South Korean warship Cheonan. The South blames the North for the sinking. North Korea denied it was responsible.
South Korea and the United States have no plans for their joint exercises to involve the five frontline islands in the Yellow Sea that are closest to North Korea, a U.S. military official told CNN.