Dozens of South Korean workers returned from a jointly run factory park in North Korea on Saturday as part of an evacuation of the flagship project following months of military tensions.
The move plunges into doubt the future of the Kaesong complex -- once a rare symbol of cooperation across the world's most heavily militarised border, and a crucial source of hard currency for Kim Jong-Un's isolated nation.
The workers' return came on the same day that the North announced it would put a Korean-American arrested in November on trial for trying to overthrow the communist regime -- a move sure to add to frictions with the West.
Seoul said Friday that it had decided to pull all remaining employees from Kaesong after Pyongyang rejected its ultimatum to join formal negotiations on restarting the stalled operations.
A total of 126 people, including one Chinese national, returned on Saturday through a border checkpoint in Paju in dozens of vehicles loaded with assembled goods and other materials salvaged from the complex.
"I feel more worried than relieved being back home for the first time in a month," Cho Yong-Joo, a manager for a Seoul electronics firm, told AFP after crossing the tense frontier.
"Kaesong ought to survive but things are not good," he said.
Some of the workers burst into tears when reunited with colleagues waiting to welcome them home.
The roughly 50 people remaining at the industrial zone -- mostly government employees who manage the site as well as telecom and electrical engineers -- are expected to be pulled out on Monday, according to Seoul.
South Korean companies with factories at the site have expressed shock at the abrupt withdrawal.
"I was so full of dreams and hopes seven years ago," said Park Yun-Kyu, the head of a Seoul clothing company.
"Now things look so grim and I don't know what to do," he told AFP while waiting for his last two employees to return.
The complex is the victim of a cycle of escalating tensions triggered by a nuclear test by the North in February, which came just over a year after Kim Jong-Un took power following the death of his father Kim Jong-Il.
A spokesman for the North's General Bureau for Central Guidance to the Development of the Special Zone slammed Seoul's pullout as "sheer sophism and hideous provocation of confrontation maniacs", saying the "puppet south Korean regime" was plotting the collapse of Kaesong.
"One cannot but express concern over to what catastrophe the stupid and reckless confrontation maniacs will push the inter-Korean relations," he said, according to the North's state media.
Pyongyang, which has demanded the end of UN sanctions and a halt to all South Korea-US joint military exercises, decided on April 3 to block all South Korean access to Kaesong although it has allowed workers to leave.
Days later, the North pulled out its 53,000-strong workforce and suspended operations, angered by the South's mention of a "military" contingency plan to protect its staff at the site.
"The next South Korean step could be to cut off electricity to the complex before closing it permanently," said Yang Moo-Jin, a professor at the University of North Korean Studies in Seoul.
"South Korea's strong response may result in the disappearance of the last remaining point of contact -- and a prolonged confrontation -- between the two Koreas."
Established in 2004, the complex lies 10 kilometres (six miles) inside the North, which remains technically at war with the South after the 1950-53 Korean War was concluded with a ceasefire rather than a peace treaty.
People who have worked there said it offered a rare opportunity for North Koreans to interact with outsiders.
"I'll never forget all the memories shared with North Korean managers there," said an electronics company worker who spent three years at Kaesong.
"We were vastly different in terms of our way of thinking, living and eating. But we were still friends," he said.
"More than 50,000 North Koreans have had a taste of capitalism and South Korean society. That's something you should never forget," he added.