South Korea is to strengthen its military force on five islands close to North Korea, amid tensions over a clash that left four people dead.
It will also review military policy on the use of force, amid concerns it had become "rather passive".
North Korean shelling of a South Korean island on Tuesday killed two civilians and two marines, and prompted an increase in regional tension.
Chinese Premier Wen Jiabao has urged both to exercise "utmost restraint".
North Korea, meanwhile, has threatened further military action if South Korea continues on what it called a "path of military provocation", the North's official KCNA news agency reported.
Pyongyang also blamed the new level of hostilities on the United States - saying the US helped draw up the "illegal" western maritime border between the two Koreas.
Troop increaseThe clash two days ago was one of the worst incidents between the two Koreas, who remain technically at war following the 1950-53 Korean War.
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