The North's sudden move came a day after the two Koreas agreed in principle to hold a Red Cross meeting on family reunions.
"In a message sent today to our side, North Korea said it is retracting its proposal in an effort to focus" on separate discussions on reopening a jointly-run industrial estate, a unification ministry official told AFP.
Pyongyang proposed yesterday that a Red Cross meeting on restarting a temporary family reunion programme be held on July 19. It also suggested talks on July 17 about restarting tours by southerners to its Mount Kumgang resort.