North Korea fired an artillery barrage Monday into waters near the disputed inter-Korean sea border as tensions rose over a South Korean naval exercise and the seizure of one of Seoul's fishing boats.

Seoul military officials said the North's batteries fired about 130 shells into the Yellow Sea soon after the South's navy ended a five-day naval exercise south of the borderline -- for which the North had threatened retaliation.

"Our navy was placed on high alert, closely watching the movement of North Korean troops," a Joint Chiefs of Staff (JCS) spokesman told AFP.

The United States decried the move as not a "helpful sign" for reducing tensions on the peninsula.

"It is not a helpful sign by North Korea and this is exactly the kind of behavior that we would like to see North Korea avoid," State Department spokesman Philip Crowley told reporters.

"The firing of very large number of rounds in the region is the last thing we want to see and is not the best way to reduce tension," Crowley said, adding it is unclear what Pyongyang means to achieve with this "chest thumping."

He added: "There will be no reward for these provocations."

The North's seizure Sunday of a South Korean fishing boat in the Sea of Japan (East Sea), on the other side of the peninsula, has further inflamed the antipathy between the two nations.

Most of the shells landed on the North Korean side of the borderline but some fell on the southern side, according to a JCS official quoted by Yonhap news agency.

Three minutes after the firing began at 5:30 pm (0830 GMT), the South's navy patrol ships warned the North Koreans by radio to stop firing but the warning was ignored, the official said.

South Korea's largest-ever anti-submarine exercise was a show of force after Seoul accused its neighbour of torpedoing a South Korean warship in March near the contested border.

The North, which denies staging the attack that killed 46 sailors, had warned of "strong physical retaliation" against the navy drill which it described as a preparation for invasion.

The border drawn by UN forces after the 1950-1953 Korean War was the scene of deadly naval battles in 1999 and 2002 and a firefight last November which left a North Korean boat in flames.

Some analysts believe the alleged torpedo attack was in revenge for the November clash.

Earlier Monday Seoul urged Pyongyang to free the 41-ton squid fishing boat and its crew as soon as possible.

It was unclear whether the weekend seizure was a response to the naval drill, or just an attempt to curb alleged illegal fishing.

The South's unification ministry said there had been no word from the other side since the Daeseung 55 was detained in or near an exclusive economic zone proclaimed by the North in the Sea of Japan.

The South's coastguard has said the boat, which was being towed Sunday to the North's port of Songjin, was presumed to have been in the zone when seized.

"The government has urged the North to deal quickly with the case and release our crew members and their boat in accordance with international law and practice," said unification ministry spokesman Chun Hae-Sung.

It was unclear where the boat -- with four South Korean and three Chinese crew -- was located when it was seized, he said.

China's embassy in North Korea has expressed concern over the reported detention of the boat and crew, Xinhua news agency said.

If the report was confirmed, North Korea "should treat the Chinese crew members well with humanitarianism, guarantee their rights and interests, and inform the Chinese side", the Chinese agency quoted the diplomats as saying.

South Korea, the United States and other countries cite the findings of a multinational investigation to accuse the North of sending a submarine to torpedo the corvette.

The North says the allegations are a smear campaign designed to furnish a pretext for aggression.

Military officers from the North and the US-led United Nations Command were Tuesday to hold their fourth round of talks on the warship sinking at the border truce village of Panmunjom.

The UN Command has been based in the South since the end of the war to enforce the armistice which ended the conflict.

At previous rounds the North demanded the right to send investigators to the South to inspect evidence dredged from the seabed, including what Seoul says is a part of a North Korean torpedo.

South Korea has rejected the demand, saying the UN Command should handle the case as a serious breach of the armistice.

The exercise which ended Monday was one of a series planned in coming months, some of them joint drills between South Korea and its US ally.