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Seoul: South Korea and North Korea will later Tuesday lift the orders placing their military forces on the highest alert, the defence ministry said.

"South Korean military would take proportionate actions and closely monitor the move of North Korean forces as it agreed to release the order of its troops into a state of war from noon Tuesday," Xinhua quoted Defence Ministry spokesman Kim Min-seok as saying on Tuesday.

As agreed upon during the inter-Korean dialogue, South Korea will stop propaganda broadcasts in frontline areas, the spokesman said, but the broadcast loudspeakers would be stationed in where they are as the removal of the speakers was not discussed.

North Korea had denounced the propaganda broadcast as a declaration of war.

Kim said South Korean troops will be placed on the highest alert till noon before downgrading the readiness level gradually.

The two Koreas agreed early on Tuesday to defuse tensions on the peninsula following a 43-hour marathon dialogue at the truce village of Panmunjom.

South Korean President Park Geun-hye on Tuesday expressed hopes that the country can resolve all issues with North Korea based on inter-Korean trust following the agreement to defuse tensions on the Korean Peninsula.

North Korea expressed regrets over injured South Korean soldiers caused by landmines blast that happened on the southern section of the demilitarised zone (DMZ) on August 4.

The incident escalated the inter-Korean tensions into a crisis that militaries of the two countries were put on the highest alert.

North Korea agreed to lift the order of its forces to enter a state war.