Today's high seas shootout between warships from North and South Korea, which resulted in one sunken North Korean ship, appeared to have eased tonight without igniting a larger conflict on this tinderbox peninsula.

South Korean military forces remained in a heightened state of alert, but both sides withdrew their ships from the area where this morning's volley of cannon fire occurred, a crab-rich area of the Yellow Sea that both countries have claimed since the Korean War ended in 1953.

U.S. Navy and Air Force planes increased patrols over the Yellow Sea, and the United States is considering sending more ships or other resources to the area, according to a U.S. defense official in Washington.

Warships from both countries have been facing off in the area since June 8, when North Korean military ships began daily incursions into the disputed zone accompanying a fleet of crab-fishing boats.

At least seven South Korean sailors were injured in the 10-minute exchange of shots. North Korea made no official statement about casualties on its side, and reports varied widely. South Korean media reported that 20 or more North Koreans may have died.

South Korean officials say the North Koreans started shooting after southern ships tried to chase the northern boats out of the southern zone. A northern torpedo boat opened fire when a southern patrol boat tried to push it back into its own waters, according to a Defense Ministry spokesman in Seoul. A State Department official also said a North Korean vessel fired the first shots.

North Korea tonight demanded an apology from Seoul, claiming that the shooting, which it said resulted in the sinking of one of its ships and damage to three others, was a "reckless military provocation" designed to push the two Koreas to "the brink of war."

The sunken vessel was believed to be a 40-ton Sin Hung-class PT 1806, a North Korean version of a Soviet-designed torpedo ship, the Defense Ministry said. A 400-ton Taechong 2 patrol boat, which had appeared to be sinking after the shooting, later seemed to have made it back to northern waters, the Defense Ministry said.

Within hours of the 9:25 a.m. incident, Pyongyang had pulled its warships back into its territorial waters without further violence. And it signaled its willingness to continue diplomatic dialogue with South Korea by sending its generals to a previously scheduled meeting shortly after the shooting occurred.

"If the North had not shown up for that meeting, it would have been a bad omen," said Moon Chung In, a political science professor at Yonsei University in Seoul, who, like many analysts here, predicted that today's shootout would not escalate into a larger military confrontation.

Ironically, the shooting may have shored up the leadership credentials of an unlikely hawk: South Korean President Kim Dae Jung, whose moderate "sunshine policy" of engagement with Pyongyang has been criticized recently by political opponents who call it naive. One opposition leader said this week that South Korea's inaction in the face of the North Korean incursions over the past week revealed the "blind spot" in Kim's policy.

"A lot of conservatives had been criticizing the sunshine policy, but this shows Kim believes in a strong national security first," said Moon. "I think he proved that today to Korea. In that sense, it's a political score."

Hwan Won Tak, a senior aide to Kim, said today that the shooting would not stop South Korea from participating in Monday's scheduled meeting in Beijing of top-level government officials from both Koreas. The two nations are to discuss a variety of humanitarian and diplomatic issues, including a proposal for South Korea to provide 200,000 tons of fertilizer to help North Korea ease its acute and chronic food shortages. North Korea has not indicated whether today's incident would force it to skip the Beijing meeting.

But South Korean officials walked a delicate line today, balancing their desire to continue engaging North Korea diplomatically with stern warnings that provocations would be met with force.

"This incident is an outright challenge to our government effort to maintain patience and not provoke armed conflict, despite the fact that the North started this infiltration," the Defense Ministry said today. "North Korea bears total responsibility for this incident."

Analysts tonight said North Korea's motive for provoking a firefight with South Korea remained mysterious -- as is often the case with the enigmatic Stalinist nation. Incursions by North Korean military vessels are not unusual, especially at the height of the fishing season for the expensive species of crab found off the peninsula's western coast. But usually, the North Koreans retreat quickly before any confrontation with South Korean warships.

"I think they want to up the ante and put us on the defensive," said Lho Kyong Soo, a political science professor at Seoul National University. "I think the intent is to test us."