South Korea and the United States are continuing their joint military exercises in Seoul.

Wednesday marked the third day of the Ulchi Freedom Guardian drills which will last 11 days. Meanwhile, South Korea's Defense ministry announced more drills will be held in the coming months.

Wednesday's anti-terror drill was held at the planned location of the G20 summit in November.

The exercise began with a simulated chemical, biological and radiological terror attack, with yellow and white smoke billowing from a bin outside the building.

Special forces, police and fire fighters were dispatched to the site to rescue people and conduct a detoxification process.

During a hostage-rescued operation, special forces rescued hostages by attacking terrorists from land and air.

The frequent military drills have upset the DPRK which warns of counter-actions and blames the war games for escalating tension.

Despite the DPRK's opposition, South Korea's Defense Ministry announced that joint anti-submarine drills will be held in the Yellow Sea in early September.

The drills will follow two sets of large-scale joint military exercises recently held by Seoul and Washington in South Korea, under a framework agreed to by top diplomats and defense officials from the two countries in late July.