The two-day talks were the first since the North shelled a South Korean island in November, which killed four people including two civilians.
The breakdown has now closed a slim opening for talks following a flare-up of tensions in recent months.
The North’s delegation walked out of talks on Wednesday after rejecting the South's demands for an apology, the South's defence ministry said.
South Korea said Pyongyang must apologise for the shelling and the sinking of a warship. Seoul accuses its neighbour of torpedoing a warship in March last year close to the border with the loss of 46 lives.
North Korea, however, said the talks should focus on halting all military actions that can be considered provocative by the other side.
"The army and people of the DPRK (North Korea) do not feel any need to deal with the group of traitors any longer, now that they do not wish to see North-South relations improved but totally reject dialogue itself," a press release from the North Korean delegation said.
The North flatly denies involvement in the ship sinking, and says its bombardment of Yeonpyeong island was a self-defensive measure in response to a South Korean live-fire drill there.