North Korea on Friday ordered some 40 South Korean staff to leave a jointly run mountain resort in the North as ties soured further over Seoul's refusal to restart tours there, officials said.
The North ordered out all except 12 employees of Hyundai Asan, the South Korean company that developed the resort and was running the tours, and four others from a golf course operator.
"This means some 40 South Koreans staying at Mount Kumgang resort have to return home by Monday morning," a unification ministry spokesman said.
Last week the communist state confiscated five properties owned by the Seoul government at the resort, and this week it has been barring access to privately owned premises there.
The sanctions-hit state is angry at the Seoul government's refusal to restart tours, suspended in July 2008 after North Korean soldiers shot dead a Seoul housewife who strayed into a military zone.
The tour programmes used to earn the impoverished state tens of millions of dollars a year.
South Korea has said the unilateral actions contravene international norms and practices and seriously hurt relations, vowing to "respond resolutely" but without elaborating.
Tensions are already high following the unexplained sinking of a South Korean warship near the disputed border on March 26, although the South has not so far accused the North of involvement.
The North has also threatened to review the other major cross-border project run by Hyundai Asan -- an industrial park at Kaesong just north of the border, where 42,000 North Koreans work at 110 South Korean-funded plants.
Both Kaesong and Kumgang were developed as symbols of reconciliation between the divided Koreas but have always been hostage to political tensions.
Nearly two million South Koreans travelled to Kumgang between 1998 and 2008, with the business earning the North some 487 million dollars.