SEOUL (AFP) - South Korean and US troops launched a joint military exercise Monday, prompting an infuriated North Korea, which has threatened both countries with nuclear attack, to sever a hotline with Seoul.

The start of the two-week "Key Resolve" exercise follows a week of escalating tensions on the Korean peninsula, with North Korea lashing out over tightened UN sanctions adopted after its third nuclear test last month.

Pyongyang has condemned the joint manoeuvres as a provocative invasion rehearsal and announced that - effective Monday - it was scrapping the 1953 armistice ending the Korean War and voiding peace pacts signed with the South.

The South's Unification Ministry confirmed that the North appeared to have carried through on another promise to cut the hotline between Pyongyang and Seoul.

The two sides habitually speak twice a day, but "the North did not answer our call this morning", a spokeswoman for the South's Unification Ministry said.

The hotline was installed in 1971 and the North has severed it on five occasions in the past - most recently in 2010.

The Rodong Sinmun, the newspaper of the North's ruling communist party, confirmed in Monday's edition the "complete end" of the armistice which halted the 1950-53 Korean War hostilities.

"With the ceasefire agreement blown apart... no one can predict what will happen in this land from now on," the newspaper said.

As the war concluded with a military armistice rather than a peace treaty, the two Koreas remain technically at war.

Sabre-rattling and displays of brinkmanship are nothing new in the region, but there are concerns that the current situation is so volatile that just one accidental step could escalate into serious confrontation and conflict.

"Key Resolve" is an annual, largely computer-simulated exercise, but still involves the mobilisation of more than 10,000 South Korean and 3,500 US military personnel. About 28,500 US troops are stationed in South Korea.