North Korea will send 22 athletes to next month's Winter Games in the South, the International Olympic Committee said Saturday, approving a landmark deal between two nations still officially at war.

South Korea had hoped that the Games which begin in Pyeongchang on February 9 could help ease the crisis on the peninsula that surged to new heights in recent months over the North's nuclear and missile and programme.

In a surprise New Year's announcement, the leader of Stalinist North Korea, Kim Jong-Un, indicated he was open to sending a delegation to Pyeongchang.

North and South then reached a deal on a set of momentous compromises, including having delegations from both countries march together at the opening ceremony and the formation of a unified women's hockey team.

But Seoul and Pyongyang still needed approval from the IOC, as the pact required the suspension of some basic Olympic rules.

IOC president Thomas Bach gave that approval Saturday, following closed-door talks with the leaders of the Olympic committees from both Koreas, Pyeongchang 2018 organisers, and senior government officials from the two countries.

"Let us not forget that such an agreement would have seemed impossible only a few weeks ago", Bach said, in an apparent reference to the feverish tension triggered last year by the North's repeated missile tests.

The final deal cleared 22 North Korean athletes to compete in three sports and a total of five disciplines.

Those include figure skating, short-track speed skating, cross-country skiing and Alpine skiing, as well as hockey.

In approving the joint hockey team, IOC brass overruled concerns raised by some hockey federations over fairness.

At the opening ceremony, the joint delegation "will be led into the Olympic stadium by the Korean unification flag" carried together by athlete from each country, the IOC said.

A special unity uniform will be created for the event.

As no North Korean athlete had technically qualified for Pyeongchang, Saturday's announcement required extending qualification deadlines in the sports concerned.

Bach acknowledged that "exceptional decisions" were required to get the deal done and thanked the skiing, skating and ice hockey governing bodies for their "enthusiastic participation".

- 'Milestone' -

"Today marks a milestone on a long journey," Bach said.

"The Olympic Winter Games in Pyeongchang are hopefully opening the door to a brighter future on the Korean peninsula, and inviting the world to join in a celebration of hope," he added.

North Korea has taken part in seven of the last 12 Winter Olympics, most recently in Vancouver 2010.

But the North boycotted the 1988 Games in Seoul, so its presence in Pyeongchang -- just 80 kilometres (50 miles) south of the demilitarised zone that divides the Koreas -- has been seed as a significant, if not stunning, diplomatic coup.

North and South Korea remain technically at war since the Korean war ended with armistice, not a peace treaty, in 1953.

An IOC spokesperson confirmed that the North Korean athletes will stay in the Olympic village, quashing speculation that they may have chosen to sleep on a boat to avoid residing on Southern soil.

Regardless of where its athletes sleep, the North is unlikely to pose a significant threat in competition, as the country has only won two medals in the history of the Winter Games, in 1964 and 1992, both for speedskating.

- UN sanctions -

North Korea will also send 24 officials and 21 media representatives to Pyeongchang, all whom will receive IOC accreditation, Bach said.

Separately, the North has said it will send 550-member delegation to the Games, including cheerleaders, performers and other cultural envoys.

Seoul and the IOC will have to ensure that while accommodating the North and ensuring that the so-called "peace Olympics" pass off smoothly, they do not violate United Nations sanctions.

Security Council measures currently prohibit cash transfers to the North, while the UN has also drawn up a blacklist of officials tied to the Stalinist Pyongyang regime, individuals whose presence at the Games will create potential stumbling blocks.