US and South Korean troops will practise destroying North Korean weapons of mass destruction during an annual joint exercise this month to improve their combat-readiness, according to a report.

The allies will form a combined unit called the Joint Task Force for Elimination (JTF-E) when they begin a 10-day Ulchi Freedom Guardian exercise on August 16, South Korea's Yonhap news agency reported.

Ulchi Freedom Guardian is an annual computer-assisted simulation command-post exercise.

Some 350 troops from the US Army's 20th Support Command and South Korean soldiers will simulate the detection and destruction of North Korean atomic bombs, missiles and chemical weapons, Yonhap said.

"In contingencies, the JTF-E will be tasked with identifying North Korean facilities suspected of producing weapons of mass destruction and destroying them," a South Korean government source was quoted as saying.

US and South Korean officials described the exercise as defensive and routine. The North habitually describes such joint drills as a rehearsal for invasion.

Tensions on the peninsula have flared since the South accused the North of torpedoing one of its warships with the loss of 46 lives in March 2010.

The North denied the charge but last November shelled a border island, killing four South Koreans including two civilians.

South Korea has since then staged a series of drills alone or together with US troops as a show of strength against the North.