South Korea's defence minister, Kim Kwan-jin, has said that military action is an "option" to protect its citizens in its stand off with North Korea.
The news comes as the United States has said it will "not accept" North Korea as a nuclear state, after Pyongyang raised tensions by refusing the South entry to a joint industrial complex.
The North says it will restart all nuclear facilities including its mothballed Yongbyon reactor, which is able to produce bomb-grade plutonium.
Standing firm: Kerry stated he will not accept N Korea as a nuclear state North Korean leader Kim Jong-Un insisted it was only seeking a deterrent and did not repeat recent threats to attack South Korea and the US.
But the North delayed the daily opening of its Kaesong industrial zone with South Korea on Wednesday morning, in a move that could represent a sharp escalation of tensions between the two countries.
The North had previously threatened to close the joint complex as part of a stand-off with Washington and Seoul.
"We are waiting for access from the North Korean authorities," a Unification Ministry official said.
More than an hour after the time the daily entry clearance is normally granted, the ministry said 861 South Korean workers were in the industrial complex while 179 workers awaited access.
The complex is a rare lucrative source of income for the impoverished North since it was established as a form of joint-Korean cooperation in 2002.
Sky News Asia Correspondent Mark Stone said the site was the only place where relations between the two countries existed.
"As with everything, it's hard to know whether this is more game playing or whether they plan to keep it closed for a while," he said.
Face off: South Korea's Kim Kwan-jin and North Korean leader Kim Jong-un "But a number of analysts who have studied the Korean problem for some time said last week that while the park remained open, the situation was not overly worrying. Now it appears to be shut."
Both Washington and Seoul stressed their countries' military readiness and said de-nuclearisation was the only way forward for North Korea.
US Secretary of State John Kerry said: "What Kim Jong-Un has been choosing to do is provocative, it is dangerous, reckless and the United States will not accept (North Korea) as a nuclear state."
America's deployment of advanced aircraft and warships to South Korea was a signal that "the United States will defend our allies and that we will not be subject to irrational or reckless provocation," he said.
North Koreans attend a rally against the US and South Korea The parading of US air and naval power with nuclear capability within view of the Korean peninsula, is as much about psychological war as real war.
The US is keen to discourage North Korea's unpredictable leader from starting a fight that could get out of control.
Mr Kerry, who will visit South Korea next week, reminded the North Koreans that "they have an option, and that option is to enter into negotiations for de-nuclearisation ... and to begin to focus on the needs of their people".
Meanwhile, China has expressed "serious concern" over the escalating situation on the Korean peninsula.
South Korean trucks refused entry to the Kaesong complex An official from China's Foreign Ministry met ambassadors from the US, North Korea and South Korea, following the closing of Kaesong.
China hopes the differences can be resolved through talks and diplomacy, said Foreign Ministry spokesman Hong Lei.
United Nations Secretary General Ban Ki-moon appealed for dialogue and negotiation to resolve the crisis.
South Korean soldiers after a military drill near the demilitarised zone "Nuclear threats are not a game," he said. "Aggressive rhetoric and military posturing only result in counter-actions, and fuel fear and instability."
Meanwhile, Russia's Deputy Foreign Minister, Igor Morgulov, has expressed concern that even a simple human error could cause the crisis to escalate.
The country shares a short border with North Korea south of Vladivostok. In the current crisis, Moscow has steered clear of openly criticising North Korea.
"Russia has to be worried as we are talking about an explosive situation in the immediate vicinity of our Far East borders," he said.
US and South Korea Navy ships in formation west of the Korean peninsula "In the current tense atmosphere, it would only need an elementary human error or technical problem for the situation to go out of control and plunge into a critical dive.
"We urge all sides to refrain from any comments or actions which could further complicate the situation," said Morgulov.
A speech by the North's young leader, Kim Jong-Un, given on Sunday but published in full by the Korean Central News Agency on Tuesday, appeared to dampen any prospect of a direct confrontation with the US by emphasising that nuclear weapons would ensure the country's safety as a deterrent.
"Our nuclear strength is a reliable war deterrent and a guarantee to protect our sovereignty," Mr Kim said.
"It is on the basis of a strong nuclear strength that peace and prosperity can exist and so can the happiness of people's lives."
The crisis flared after Pyongyang was hit with US sanctions for conducting a third nuclear test in February, before America and South Korea staged military drills that North Korea viewed as "hostile".
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