South Korea has suspended military co-operation with Japan, raising the stakes in a row over new Japanese history textbooks that have angered both Seoul and Beijing.
The chairman of South Korea's joint chiefs of staff has cancelled a visit to Japan planned for later this month and Seoul has denied two Japanese navy ships permission to dock at its port of Inchon in September.
Seoul has also decided to delay the further opening up of Korean markets to Japanese cultural products, including pop songs, TV progammes, adult movies and animation.
The BBC correspondent in Seoul says the retaliatory measures are largely symbolic, but underline the strong feelings in South Korea over the issue.
Japan's neighbours are particularly upset by the new history books' failure to mention the tens of thousands Asian women - mostly Korean - forced to work as sex slaves for the Japanese military during World War II.
The Seoul-Tokyo row comes at a sensitive time, with the two countries scheduled to co-host the football World Cup in 2002.
It is also a personal setback for South Korean President Kim Dae-Jung, who pledged to improve ties with historic rival Japan soon after taking office in 1998.
But many Koreans still harbour bitter feelings towards Japan, which occupied the country for 35 years from 1910 to 1945.
Seoul had asked Tokyo in May to make 35 changes to eight books designed for use by 13- to 15-year-olds, saying they distorted the truth about Japan's occupation of the Korean peninsula.
Japan informed Seoul on Monday that it would revise only two of the 35 disputed passages.
The Japanese decision sparked protests outside its embassy in Seoul, with South Koreans calling for boycotts and the expulsion of Japan's ambassador.
South Korea's Foreign Ministry issued a statement expressing
disappointment and regret over the Japanese decision and accusing
Japanese Prime Minister Junichiro Koizumi sought to calm the row in an interview with Japanese media.
Too much attention has been put on the antagonism (between Japan
and South Korea), he said.
We need to move our focus onto things we can work on together
as we have to hold the football event with South Korea.
Mr Koizumi said Tokyo would seek further talks with Seoul and Beijing over the dispute, but indicated that there would be no more revisions.