Two South Korean jets mistakenly dropped eight air-to-surface bombs on a village near the military border with North Korea last Thursday, injuring 29 civilians in an accident the South's military said was likely caused by pilot error.
The area was close to a regular training ground used by the allies near the border.
"We don't need to explain how the situation would have unfolded if the bombs had dropped further north and crossed our border," KCNA state news agency said.
"It is not at all an unreasonable imagination ... that an accidental spark could engulf the Korean peninsula and the world in a new armed conflict in response to the malicious large joint military drills by the US and South Korea," KCNA said.
South Korean and US militaries began annual Freedom Shield drills on Monday to run until March 20, but they suspended live-fire exercises following the bombing accident.
North Korea routinely denounces joint military drills by the allies, calling them a dress rehearsal for war against it.
South Korea rejects that accusation, saying the drills are defensive and aimed at maintaining readiness against possible North Korean aggression.
The US Defence Department did not immediately have comment.
"This incident is an example of how the various war demonstrations by the US and its followers targeting us are not for 'peace and stability in South Korea' as they claim but an extremely dangerous and unamusing acts that can breed an imminent crisis and the world's first nuclear war," KCNA said.
It warned of taking "merciless action" without notice if needed because of its enemies' military activities.
