The North has already expelled inspectors from its nuclear complex at Yongbyon and is threatening to restart the facilities.

Powell: No immediate strikes against North Korea

The US says it is not planning to attack North Korea, but does favour a "tailored containment" strategy which could include economic sanctions on Pyongyang.

The last time North Korea pulled out of the NPT, nine years ago, there was a dangerous confrontation with Washington.

A statement from the North Korean foreign ministry, carried by the North's KCNA news agency on Sunday, implied that Pyongyang could be preparing to ditch the treaty again.

It said it had halted withdrawal from the NPT in 1994 after reaching a deal with Washington, known as the Agreed Framework (AF).

However the statement went on to say that the US had begun "ditching... the AF, thus putting this special status of ours in peril".

Under the accord reached with the US in 1994, North Korea agreed to freeze its nuclear programme in exchange for fuel and aid.

But in November, Washington halted the fuel shipments because, it said, Pyongyang had admitted it was resuming its nuclear programme.

North Korea then unsealed the Yongbyon plant and began moving nuclear fuel rods there.

CRISIS CHRONOLOGY

16 Oct: N Korea acknowledges secret nuclear programme, US announces 14 Nov: Fuel shipments to N Korea halted 12 Dec: N Korea threatens to reactivate Yongbyon plant 22 Dec: N Korea removes monitoring devices at Yongbyon reactor 26 Dec: UN says 1,000 fuel rods have been moved to the plant 27 Dec: N Korea says it will expel UN nuclear inspectors

Timeline of tensions

The US Secretary of State, Colin Powell, said on Sunday that despite the crisis, his country has no immediate plans to attack North Korea.

Washington has instead set out a strategy to handle Pyongyang by isolating it economically - asking North Korea's neighbours and allies to cut economic ties, and urging the UN to impose sanctions.

But South Korea's president said on Monday that he did not support sanctions as a diplomatic approach.

Kim Dae-jung told a cabinet meeting that pressuring and isolating Communist countries had never been successful, and pledged to continue his policy of engagement with the North.

"The more stalled relations are, the more effective this sunshine policy is. We cannot go to war with North Korea and we can't go back to the Cold War system and extreme confrontation," he said.

Raised stakes

North Korea continues to demand direct talks as a way out of the confrontation.

Its stated aim is to sign a non-aggression pact with a country it sees as a direct military threat.

But the BBC's Charles Scanlon in Seoul says the US is concerned that formal negotiations would be seen as rewarding bad behaviour.

Instead, it may seek working level contacts at the United Nations or through South Korea.

Our correspondent says that the danger is that the North will in the meantime continue to raise the stakes, encouraged by Washington's measured approach and by a recent surge of anti-American sentiment in South Korea.

NORTH KOREA NUCLEAR PROGRAMME

Yongbyon: Five-megawatt experimental nuclear power reactor and partially completed plutonium extraction facility. Activities at site frozen under 1994 Agreed Framework Taechon: 200-MWt nuclear power reactor - construction halted under Agreed Framework Pyongyang: Laboratory-scale "hot cells" that may have been used to extract small quantities of plutonium Kumho: Two 1,000-MWt light water reactors being built under Agreed Framework

Analysis: North Korea's nuclear progress