"They have reached this decision following perceived unrest on the Korean peninsula," the sponsors of the European Tour event said in a statement on Monday.
There has been hostility in the region for weeks because of United Nations sanctions imposed on North Korea for a nuclear test.
On Sunday, a South Korean news agency reported that the North had moved short-range missile launchers to its east coast, apparently indicating it was pushing ahead with preparations for a test launch.
World number seven Louis Oosthuizen of South Africa will be the highest-ranked player at the Ballantine's event in Seoul starting on Thursday.
Former U.S. PGA champion Yang Yong-eun of South Korea, 1999 British Open winner Paul Lawrie and former European Ryder Cup player Paul Casey will also be chasing victory in the tournament which carries a prize fund of 2.2 million euros ($2.88 million).
($1 = 0.7644 euros) (Writing by Tony Jimenez in London, editing by Clare Fallon)
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