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North Korea rejected South Korea's proposal to hold official talks to resolve the suspension of a joint industrial complex.
"Pyongyang will be the first to take tough action if the South insists on worsening the situation at the border town," the North's National Defense Commission said in a statement monitored in Seoul.
"The kind of ultimatum made by the South the day before will only lead to no good results."
The response came hours after the Ministry of Unification said it did not receive a reply to its proposal for dialogue.
Operations of the industrial complex in the North's border town of Kaesong came to a halt on April 9, when Pyongyang pulled out all of its 53,000 workers.
The ministry set a deadline for noon and warned it could take serious measures if the North did not make its position known on talks.
The current standoff marks the most serious challenge to the complex since it started operations in late 2004.
The shutdown comes as the North has ratcheted up its warlike rhetoric in recent months after detonating its third nuclear device on Feb. 12 and launching a long-range rocket late last year in defiance of warnings by the international community.
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