The two Koreas have held a symbolic groundbreaking ceremony for reconnecting and repairing roads and railways across the divided peninsula.
North Korea has called on the South to push through joint projects despite economic sanctions that are in place.
The connection of railways and roads is among a series of measures aimed at improving bilateral ties agreed upon in September by liberal South Korean President Moon Jae-in and the North's leader, Kim Jong Un.
Seoul has stressed that the ceremony would not herald the start of actual work on reconnecting and modernising links between the two Koreas.
The two nations remain technically at war after their 1950-53 conflict ended without a peace treaty.
A South Korean Unification Ministry spokesman described it as a mere "expression of a commitment", adding that construction would depend on "progress on the North's denuclearisation and circumstances concerning sanctions".
However the North's top railway official, Kim Yun Hyok, reiterated their stance that the South stop toeing the US line on maintaining sanctions on the North until it gives up its nuclear weapons.
"If (the South) keeps looking around to check someone's mood and continues wavering, reunification would never be achieved," Mr Kim said at the ceremony at the Panmun railway station in the North's border city of Kaesong.
Moments later, some ten delegates from both the South and the North lined up along the railroad and pulled yellow levers to link up the railway tracks in a symbolic gesture.
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Seoul stressed that the ceremony would not herald the start of actual work on reconnecting and modernising road and rail links between the two Koreas - which remain technically at war after their 1950-53 conflict ended without a peace treaty.
The event is a mere "expression of a commitment" to the projects, a South Korean Unification Ministry spokesman said, adding that construction would depend on "progress on the North's denuclearisation and circumstances concerning sanctions".
The two sides wrapped up their joint railway and road inspections for the projects this month.
South Korea has set aside some $620,000 for the endeavour.
The ceremony comes as the United States ramps up efforts to convince Pyongyang to give up its nuclear weapons.
Following a rapid rapprochement earlier this year that culminated in a historic summit between Donald Trump and Kim Jong-un, progress has stalled with both sides accusing each other of dragging their feet and acting in bad faith.
Critics say North Korea has made no concrete commitments and is unlikely to surrender its atomic arsenal, while Washington's policy of maintaining pressure through isolation and sanctions has left Pyongyang seething.
Mr Trump said on Monday that he was "looking forward" to his second summit with Mr Kim, which Washington says may take place early next year.
He tweeted the statement after he was briefed by Stephen Biegun, the US special representative on North Korea, who wrapped up a three-day trip to Seoul on Saturday.
Mr Biegun said last week the United States will be more lenient in enforcing its blanket ban on US citizens' travel to the totalitarian state when dealing with aid workers, a goodwill gesture as Mr Trump seeks a fresh summit.
The Trump administration has generally refused to let US aid groups operate in North Korea, seeking to both maximise pressure on Pyongyang and ensure the safety of Americans.
Mr Biegun also said in Seoul last week that Washington was willing to discuss trust-building initiatives with Pyongyang.
Senior transport officials from Russia, China and Mongolia as well as several foreign ambassadors to South Korea will attend the ceremony, the South's Unification Ministry said.
