North Korea says it will carry out military attacks again if US - South Korean military exercises violate its territorial waters.
North Korea has reportedly deployed missiles near the South Korean border as naval exercises get underway.
South Korea's Yonhap news agency says North Korea has placed surface-to-surface missiles on launch pads in the Yellow Sea.
It said also the North had moved surface-to-air missiles near frontline areas in the face of opposition by China and threats of consequences from Pyongyang.
The United States and South Korea on Sunday began joint military exercises in waters west of the Korean Peninsula.
The exercises, which Washington says are intended as a sign of deterrence to North Korea, come less than a week after the North shelled a South Korean island near the disputed maritime boundary and killed four people.
An official from US Forces Korea said the nuclear-powered aircraft carrier USS George Washington had joined the four-day exercises.
The George Washington, which carries 75 warplanes and has a crew of more than 6,000, will be accompanied by at least four other warships.
South Korean President Lee Myung-bak told ministers and aides to be ready for further "provocation" by North Korea during the drill.
North Korea's state KCNA news agency says it will carry out military attacks again if the United States and South Korea violate its territorial waters.
"Thousand-fold" revenge vowed on North Korea
The head of South Korea's marine corps has vowed "thousand-fold" retaliation for the North Korean attack that killed two servicemen.
The two marines were honoured with a gun salute at their funeral, days after North Korea rained shells on a tiny island in the heaviest attack on South Korea since the 1950-53 civil war.
Major-General You Nak-jun said: "We'll certainly repay North Korea a thousand-fold for killing and harming our marines".
"South Korean active-duty marines and all reserve forces will engrave this anger and hostility in our bones and we will make sure we take revenge on North Korea."
His views were echoed by new Defence Minister Kim Kwan-jin, who said: "We need to deal with North Korea's provocations strongly. We need to hit back multiple times as hard."
North Korea, for its part, has accused Seoul of using human shields on Yeonpyeong Island and says the South is using the deaths for propaganda.
Two civilians were also killed reports the BBC.