The South's defense ministry said earlier it was considering a request by a Seoul church group to put up Christmas lights on a steel tower shaped like a tree atop a military-controlled hill near the border.
The North's official website, Uriminzokkiri, called the plan "a mean attempt for psychological warfare" against the communist state and threatened to retaliate immediately if the lights are switched on.
The 511-feet hill in the South, about two miles from the border, is within range of North Korean gunfire.
The tree-shaped, 98-feet high steel structure is illuminated by thousands of small light bulbs and can be seen from the North's major city of Kaesong just north of the border, according to media reports.
"The enemy warmongers ... should be aware that they should be held responsible entirely for any unexpected consequences that may be caused by their scheme," Uriminzokkiri said. "This issue ... is not something to be ignored quietly."...
The North has previously accused the South of displaying Christmas lights to spread Christianity among its people and soldiers.
