The country tested the rail-based system for the first time last September, saying it was designed as a potential counter-strike to any threatening forces.
Since New Year's Day, North Korea has launched three ballistic missiles in an unusually fast sequence of weapons tests. The previous two launches involved what state media called "hypersonic missiles" capable of high speeds and manoeuvring after launch.
Hours before the latest test drill, North Korea slammed the United States for pursuing new sanctions in response to its recent missile launches, calling it a "provocation" and warning of a strong reaction.
U.S. President Joe Biden's administration imposed its first sanctions against Pyongyang on Wednesday, and called on the U.N. Security Council to blacklist several North Korean individuals and entities.
North Korea has defended the missile tests as its sovereign right to self-defence and accused the United States of intentionally escalating the situation with new sanctions.
North Korean leader Kim Jong Un did not attend the drill. KCNA said the military leadership had ordered the test "at short notice" and the system precisely struck the target set in the east coast with "two tactical guided missiles."
The system "demonstrated high manoeuvrability and rate of hits," KCNA said, adding its success led to discussions to "set up proper railway-borne missile operating system across the country."
North Korea has been steadily developing its weapons systems, raising the stakes for stalled talks aimed at dismantling its nuclear and ballistic missile arsenals in return for U.S. sanctions relief.
South Korean Chung Eui-yong and U.S. Secretary of State Antony Blinken condemned the latest launch during their phone call on Saturday and coordinated responses to the North's recent missile tests, the State Department said.
Both sides highlighted the importance of maintaining firm combined readiness posture and urged Pyongyang to return to a negotiating table, Seoul's foreign ministry said.
'AT SHORT NOTICE'
Cheong Seong-chang, director for North Korean studies at South Korea's Sejong Institute, said the test could be an "instant display of force" to protest against the U.S. sanctions push, noting that it was not planned in advance and unusually took place in the afternoon.
"It's a message that they would take an 'eye to eye' approach if Washington presses for sanctions for testing non-long-range missiles," Cheong said.
KCNA released photographs showing a missile trailing a column of smoke and flame as it was launched from the top of an olive-green train in a mountainous area, before arrowing down on a small island, sending up a cloud of smoke and debris as it hit.
Despite North Korea's limited and sometimes unreliable rail network, rail mobile missiles are a relatively cheap and efficient option to improve the survivability of their nuclear forces, making it difficult for enemies to detect and destroy them before being fired, analysts said.
Kim Dong-yup, a former South Korea Navy officer who teaches at Seoul's Kyungnam University, said North Korea appears to have fired KN-23 SRBMs, which were also test fired in September, when they flew 800 km (497 miles).
First tested in May 2019, the KN-23 resembles Russia's Iskander-M SRBM visually, and is designed to evade missile defences and conduct a precision strikes, experts said.
(Reporting by Hyonhee Shin and Josh Smith; Editing by Leslie Adler, Sandra Maler & Simon Cameron-Moore) ((firstname.lastname@example.org; +822 3704 5658;))