North Korea boycotted the 1986 Asian Games and the 1988 Summer Olympics, both held in Seoul, but has since attended several other events in the South, including last year's Asian Games in Incheon.
The North earlier told South Korean organisers that it wanted to send 75 athletes and 33 sports officials to the multi-sport event in the South Korean city of Gwangju.
But the North cancelled the plans and told the International University Sports Federation last weekend that it will not attend the games, citing this week's opening of the UN office tasked with specialising in its alleged rights violations, according to Seoul's Unification Ministry.
North Korea also cited what it calls hostile military confrontation between the two Koreas, a ministry official said on condition of anonymity, citing office rules.
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The University Games is an Olympic-style event, with about 20,000 athletes from 170 countries competing in 21 events. The North earlier wanted to compete in eight events, including women's football, table tennis and judo, according to the statement.
Outside analysts say North Korea's participation in international sports events is an opportunity for the isolated country's athletes to show their devotion to leader Kim Jong Un so he can solidify his grip on power.