The clouds of suspicion and paranoia swirling over the world’s last remaining Cold War frontier darkened dramatically today when North Korea accused its southern neighbor of plotting to assassinate Kim Jong Il.

Government agencies within the nuclear-armed dictatorship said that they had foiled a plot involving a man who had crossed the border earlier this year armed with a collection of sophisticated spying tools, a dose of “violent poison”, and orders to “do harm to the security of the top leader” of North Korea.

The exceedingly rare public accusation was immediately dismissed as untrue by Seoul’s central spying agency, but still marks a new deterioration in the atmosphere across the Korean peninsula.

Analysts believe that the alleged discovery of an assassination attempt on Mr Kim may be a ruse by the North to divert attention from rumours of the despot’s ill health and further ratchet tensions in what is an already acrimonious climate.

There has been mounting speculation in recent months that Mr Kim suffered a stroke earlier this year and may not be in full control of world’s only communist dynasty. Provocative statements and a stream of undated photographs of the Dear Leader making various factory visits suggest to some that the Pyongyang regime is desperately trying to play down similar speculation within North Korea itself.

Relations have plunged from bad to worse over the course of 2008, with the tone of interchange between Pyongyang and Seoul descending into open taunts and provocation.

Just over a fortnight ago, North Korea threw hundreds of South Korean workers out of the shared industrial estate at Kaesong - a joint venture that once offered a glimmer of hope that the two Koreas might somehow be reconciled after 50 years of being still technically at war.

Pyongyang also threatened in late autumn to unleash “weaponry more powerful than nuclear bombs” and to burn everything in the South to ashes.

Relations between Seoul and Pyongyang have soured spectacularly since Lee Myung Bak assumed the presidency of the South earlier this year. Known as a hard-liner on the North, Mr Lee has persistently linked the North’s abandonment of its nuclear weapons programme with the flow of economic aid. The six-party talks on de-nuclearisation remain stalled.

Revelations of the alleged Kim murder plot emerged when the communist state’s Security Ministry said today that it had arrested the supposed assassin - a man known simply as Ri - while on the “terrorist mission” of a South Korean intelligence agency.

The alleged spy, said Pyongyang, then met another South Korean agent - a Mr Hwang - after a briefing on how to gather information about the official movements of Kim.

In Seoul, Choi Sung Yong, a human rights activist who claims to have worked with both Mr Ri and Mr Hwang, told reporters that both men had, indeed, passed military information about the North back across the border, but that there was no assassination attempt involved. Mr Choi was responsible for sending a series of vehemently anti-Pyongyang leaflets across the world’s most heavily militarised border in a balloon. He added his belief that Messrs Ri and Hwang were actually arrested in late 2006.

On the same day as Pyongyang revealed the supposed assassination plot, one of the regime’s newspapers launched a separate attack on President Bush, applauding the recent incident where an Iraqi journalist flung his shoes at the startled US President.

The newspaper, in a reference to a favourite North Korean allusion to humiliated pride, described Mr Bush as looking like “a cockerel soaked in the rain”.

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