The South switched off blaring propaganda loudspeakers, and the North lifted a "semi-war state" - the two Koreas stepped away from a tense military stand-off yesterday but analysts are sceptical about an enduring calm.
After three days of intense talks at the Panmunjom truce village inside the Demilitarised Zone, Pyongyang expressed "regret" over recent landmine blasts that wounded two South Korean soldiers and led to soaring tensions when Seoul turned on the propaganda broadcasts.
The two rivals struck a deal that includes more talks to improve relations and an aim to resume reunions of families separated by the Korean War.
But given North Korea's history of hostile threats, experts say it remains to be seen if the goodwill achieved from this latest round of "tantrum diplomacy" can be sustained.
"The test of whether this agreement marks a real turning point in inter-Korean relations will lie in the ability of both sides to keep their agreements and to institutionalise future dialogue and cooperation in such a way as to minimise their respective points of vulnerability," said Mr Scott Snyder, a senior fellow for Korea studies at American think- tank Council on Foreign Relations.
One thing is clear though - both Koreas do not want the conflict to develop into a full-blown war as the consequences would be dire, especially in the drought-plagued North where electricity is scarce.
That would explain why Pyongyang initiated talks last Saturday, after failing to get Seoul to silence its deafening loudspeaker assault across the border.
"Our side stopped the broadcasts, but we are maintaining our alert posture while we monitor the movement of North Korean troops," a spokesman for South Korea's Defence Ministry said, according to Agence France-Presse. "It will take time for them to pull back."
Tension had escalated after the two sides exchanged artillery fire and beefed up their defences along the border last week, with North Korean leader Kim Jong Un going as far as to declare a "semi-war state" in the country.
Dr Kongdan Oh, a researcher at the Institute for Defence Analyses, says the current truce is only temporary as it is the result of "another round of bluffing, threats and backing down".
"North Korea will trigger another provocation again at an unpredictable time. It is their reason to survive," she said.
An opportunity will present itself in October. Observers expect a big show of force from North Korea to commemorate the 70th anniversary of its ruling Workers' Party, in the form of a missile launch or nuclear test.
"If North Korea does not launch new tests in October, that will certainly have been influenced by the crisis and diplomacy of August," said Dr Katharine Moon from the Brookings Institution's Centre for East Asia Policy Studies.
"Even if little substance follows after this crisis, Seoul will be able to claim success over diplomatic negotiations and for having stood up to North Korean provocations."
South Korea has been trying to engage the North in dialogue in a bid to advance their relations, while maintaining a resolutely tough stance against Pyongyang's provocations.
South Korean President Park Geun Hye was widely lauded by the local media for refusing to back down and repeatedly demanding an apology from the North over the landmine blasts - a move that has seen her approval rating increase to more than 40 per cent for the first time in three months.