The North has put an end to the rail link that had raised hopes of reconciliation between the Cold War foes, accusing Seoul of seeking a "confrontational" policy toward it.
The two Koreas technically remain at war because the 1950-53 Korean conflict ended in a truce, not a peace treaty.
The rail service – launched a year ago for the first time in more than half a century – was one of the prominent fruits of a decade of reconciliation efforts. Ties began warming following the first-ever summit of their leaders in 2000, with two liberal South Korean presidents adopting a "Sunshine Policy" of reaching out to the North with aid.
But relations chilled again this year with the election of conservative Lee Myung-bak as the South's president.
Mr Lee has cast doubt on the implementation of key accords his predecessors struck with the North's Kim Jong Il that call for providing aid to the North without condition. His administration also recently sponsored a UN resolution denouncing Pyongyang's human rights record.
Angry at his hard-line stance, North Korea announced last Monday the suspension from 1 December of the rail link and a popular tour programme to its historic city of Kaesong. Eighty-eight South Korean companies run factories there, employing some 35,000 workers from the North.
The daily round-trip by train has been largely symbolic, with services running almost empty most of the time. The link was intended to help ship raw material and products to and from Kaesong, but South Korean firms prefer to use a road running parallel to the railway.
Yesterday, South Korea sent the last batch of tourists to Kaesong before the programme is suspended. Weekend tours were cancelled as the border checkpoint is expected to be crowded with South Koreans leaving Kaesong.
Currently, about 4,000 South Koreans have permits to travel to or stay in the enclave.
Seoul said yesterday that North Korea had agreed to allow up to 1,700 of them to keep their permits, with negotiations continuing.