"Dialogue and confrontation, peace and war can never go together," North Korea's Committee for the Peaceful Reunification of the Fatherland said in a statement carried by the official Korean Central News Agency.
"We will sternly take self-defensive steps to defend (the) peace and stability of the Korean peninsula," it said. The statement did not say what it meant by self-defensive steps.
The reaction came hours after the tens of thousands of South Korean and American troops began their exercises, and amid an impasse in international efforts to strip the North of its nuclear weapons programs.
"The reckless war maneuvers create a severe obstacle to resolving the nuclear issue between the North and the U.S.," the KCNA report said.
Washington has accused Pyongyang of not fully disclosing its nuclear programs under an aid-for-disarmament agreement struck last year.
North Korea says it gave the U.S. a list of its nuclear programs, but Washington says Pyongyang never produced a "complete and correct" declaration.
About 27,000 American troops, the USS Nimitz aircraft carrier, and an undisclosed number of South Korean soldiers were participating in the drills, dubbed Key Resolve and Foal Eagle, according to the U.S. and South Korean militaries.
The exercises, scheduled to run until Friday, involve a computer-simulated war game with field drills, and "provide an excellent opportunity to improve ... combat readiness," U.S. Army Gen. B.B. Bell, commander of U.S. Forces Korea, said in a statement last month.
The maneuvers were "key to our readiness and effective deterrence," Bell said. A U.S. military spokesman told The Associated Press no new statement would be issued Sunday.
About 28,500 U.S. troops are based in South Korea, a legacy of the 1950-53 Korean War. The conflict ended in a cease-fire, not a peace treaty, leaving the two Koreas technically still at war.