It was not immediately known whether any North Korean troops were injured or killed in the firefight in the Demilitarized Zone, a buffer area that was created at the end of the 1950-53 Korean War to keep opposing armies apart.
Tension on the Korean Peninsula is high over North Korea's suspected development of nuclear weapons, and such shooting incidents in the DMZ are rare. In recent years, however, reconciliation efforts have moved forward despite such outbreaks of violence.
North Korean soldiers fired four rounds at 6:10 a.m. local time, and South Korean soldiers fired 17 rounds in response one minute later, said Maj. Lee of the South Korean Joint Chiefs of Staff. He speculated the North Koreans were using machine guns, and said the South was using a machine gun called a K-3.
Under terms of the armistice that ended the Korean War, North and South Korean soldiers can patrol in the DMZ, but they are not allowed to carry heavy weapons such as machine guns.
Lee, who did not give his first name, said he could not comment on whether the South Korean soldiers were violating the weaponry rules. He said the incident happened near the South Korean town of Yonchon.
Over the decades, violence has periodically erupted at the DMZ, though such incidents have tapered off in recent years. The area is laced with tank traps, minefields, fences and observation posts.
White House and Pentagon officials this week said North Korea's announcement that it is moving toward producing new nuclear weapons was a problem, but not a crisis. But a former defense secretary said the U.S. is "losing control" of the situation.
North Korean representatives claimed last week to have finished extracting plutonium from 8,000 spent nuclear fuel rods. That could allow the communist country to build six nuclear bombs, adding to an arsenal suspected of already holding one or two nuclear weapons.
President Bush has vowed not to tolerate nuclear weapons on the Korean peninsula. Besides threatening the 37,000 American troops in South Korea, U.S. officials worry North Korea could sell or give some of its nuclear material — or worse, an assembled weapon — to other states or to terrorists.
The White House says Mr. Bush plans to continue pressing for a diplomatic solution to the impasse. But administration officials have not ruled out a military response.
Asked if Mr. Bush might resort to military force against North Korea, spokesman Scott McClellan said, "The president never takes options off the table, but it's something that we want to address in a multilateral way."
But former Defense Secretary William Perry said in an interview with The Washington Post: "I have thought for some months that if the North Koreans moved toward processing, then we are on a path toward war."
"I think we are losing control. The nuclear program now underway in North Korea poses an imminent danger of nuclear weapons being detonated in American cities," Perry told the newspaper.
Perry, a Korea expert who was President Clinton's defense chief when airstrikes were plotted against North Korea in 1994, said the situation "was manageable six months ago if we did the right things. But we haven't done the right things."
He expressed confusion over what the U.S. policy is, and said diplomatic efforts have been "inconsequential." He believes Mr. Bush is morally opposed to negotiating with Stalinist ruler Kim John Il.
"I have held off public criticism to this point because I had hoped that the administration was going to act on this problem, and that public criticism might be counterproductive. But time is running out, and each month the problem gets more dangerous," he told The Post.
Tensions over North Korea's nuclear program have been on the rise since October, when Pyongyang admitted having a clandestine program to enrich uranium for nuclear weapons. The admission led to the collapse of the 1994 agreement in which North Korea had agreed to freeze its nuclear weapons program in exchange for fuel aid and the construction of two nuclear power generating stations.
Since then, North Korea has withdrawn from the Nuclear Non-Proliferation Treaty and ejected International Atomic Energy Agency inspectors.
The United States has insisted on talks involving other countries in the region, such as China, South Korea and Japan, while North Korea has for the most part said it wants to talk only to the United States.
However, North Korea recently said it might consider U.S. demands for talks involving several nations, if it can also meet one-on-one with the United States.
A Japanese newspaper reported Wednesday that North Korea notified U.S. officials last week that it would be receptive to multilateral talks if Washington guarantees preservation of its communist regime.
The New York Times reports China has proposed hybrid talks that would combine multilateral sessions with one-on-one discussion between the United States and North Korea.
The State Department rejected that approach, with spokesman Richard Boucher saying, "It doesn't deal with the serious issues that are involved in North Korea's affronts to the entire international community."
North Korea said Wednesday that U.S. demands for multilateral talks to resolve the crisis were complicating the issue.
On Tuesday, U.S. officials said they were not sure whether North Korea's claim was a bluff or the truth.
A Pentagon official said Tuesday it was unlikely that the North had completed processing the fuel rods at its Yongbyon nuclear complex, although officials from the United States and South Korea have said they believe the process has begun.
Some observers have speculated that North Korea might be angling for more aid.
Boucher said the U.S. "will not submit to blackmail, we will not offer any incentives or inducements for North Korea to stop something they never should have started to begin with."