The South Korean and U.S. militaries were placed on heightened levels of alert and surveillance on Thursday, one day after North Korea threatened the South with a possible military attack. The allied troops, including, 25,000 U.S. soldiers based in South Korea, raised their Watch Condition, or Watchcon, to the second-highest level, the South Korean Defense Ministry announced. The upgrading from Watchcon 3 to Watchcon 2 involves a significant increase in the use of reconnaissance planes and spy satellites, as well as a more vigorous gathering and analysis of electronic signals from the North, ministry officials said. Watchcon 2 status is taken when the militaries fear a grave threat, the officials said, adding that the level has not been this high since October 2006, when North Korea conducted its first nuclear test. North Korea had escalated its baleful rhetoric against South Korea and the United States on Wednesday with warnings of a powerful military strike if any North Korean ships were stopped or searched as part of an American-led operation to intercept vessels suspected of carrying unconventional weapons. South Korea had agreed to join the operation after North Korea tested a nuclear device on Monday, its second nuclear test in three years. The North had earlier warned the South not to participate in the operation, known as the Proliferation Security Initiative. We consider this a declaration of war against us, North Korea said in a statement carried by its official news agency, KCNA. Any hostile act against our peaceful vessels, including search and seizure, will be considered an unpardonable infringement on our sovereignty, and we will immediately respond with a powerful military strike. The North Koreans also said in the statement that they no longer feel bound by the armistice that ended the fighting in the 1950-53 Korean War. Technically, the two Koreas have remained at war for more than 50 years, because the 1953 armistice was never replaced with a final peace treaty. The North Koreans had previously called the armistice a useless piece of paper and declared that they no longer felt bound by it. But they have rarely used the threat of abandoning the armistice. North Korea continues to act in a provocative and belligerent manner toward its neighbors, said Secretary of State Hillary Rodham Clinton. There are consequences to such actions. At the United Nations, she said, discussions were under way to add to the consequences North Korea will face. American and Japanese diplomats were drafting a Security Council resolution that would concentrate on five or six ways to flesh out existing sanctions against North Korea that had never been enforced, diplomats said. Although China supports the idea of sanctions, it wants to work slowly and to bolster measures first passed in 2006 rather than creating new ones, they said. The proposals include banning imports and exports of all arms only heavy weapons are restricted now. We want to dry out their resources for the military, said a senior Western diplomat, speaking anonymously because of the sensitivity of the negotiations. North Korea has said that it will consider further sanctions a declaration of war. If North Korea stages a provocation, we will respond resolutely, the South Korean military said in a statement, reacting to the Norths threats. Citing a strong military alliance with the United States, it said, We advise our people to trust our militarys solid readiness and feel safe. The analysts said North Korea might stage a limited armed provocation along the border, especially along the disputed western sea border. The two navies clashed there in skirmishes in June 1999 and June 2002 during the crabbing season. South Koreas president, Lee Myung-bak, lauded his people on Wednesday for their mature response to the Norths behavior. He noted that the Norths nuclear test and its subsequent missile launchings did not affect stock indexes and foreign exchange markets beyond initial jitters. Seoul, the South Korean capital, with a population of 10.4 million, is just 35 miles from the North Korean border and well within the range of North Korean missiles and artillery. But most South Koreans and foreign investors here are accustomed to threats from the North. Meanwhile, analysts said, South Koreas decision to join the antiproliferation initiative a global effort that seeks to interrupt air and sea deliveries of nuclear and other unconventional weapons, missile parts and delivery systems is largely symbolic. Seoul has said that it will stop only suspicious ships in its own territorial waters, a sovereign right it already has. In addition, the chance that the North would send ships carrying such materials into South Korean waters is low.