South Korea's Vice Unification Minister Chun Hae-sung confirmed Pyongyang's participation in the Pyeongchang games on Tuesday during the first high-level talks between the two rivals since 2015.
The South Korean official also told reporters at the border village of Panmunjom, the venue for the talks, that Seoul had proposed the two teams march together at the Games' opening ceremony.
The Winter Olympics will run from February 9 to 25 in Pyeongchang, a city just 80km from the border between the two Koreas.
"North Korea said that they are determined to make today's talks fruitful, and make it a groundbreaking opportunity," Chun said.
At the start of the rare meeting, both sides expressed their optimism and "high hopes".
''We came to this meeting today with a serious and sincere attitude and with the thought of giving our brethren, who have high hopes for this dialogue, invaluable results as the first present of the year," Ri Son Gwon, head of the North Korean delegation said.
Meanwhile, South Korea's Unification Minister Cho Myoung-gyon said: ''Our talks resume after the North and South Korean ties have been severed for a long time, but I believe the first step is half the journey. I would like to hold this meeting with tenacity and perseverance.''
South Korea has also proposed the two sides hold military talks to reduce tension on the peninsula, Chun told reporters.
The South Korean official added that Seoul had suggested resuming temporary reunions of families separated by the Korean War.
The high-level meeting comes after months of tension over North Korea's nuclear and missile tests.
South Korea offered last week to hold the talks on Jan 9 to discuss the participation of North Korean athletes at the Winter Games.
The proposal came a day after North Korean leader Kim Jong-un said that he was "open to dialogue" with Seoul and that Pyongyang may attend the games.
Al Jazeera's Kathy Novak, reporting from the South Korean capital, Seoul, said: "The fact that these talks are going ahead at all is being seen as a positive step here in South Korea.
She added: "The South Korean government wanted the North Korean delegations at the Winter Games in the country as a show of peaceful unity, so it would very much welcome this news."