The navy plans to hold the exercise near the Seoul-controlled chain of islets, called Dokdo by the South and Takeshima by Japan, tomorrow, the defence ministry said.
"The navy plans to hold live-fire exercises near Dokdo tomorrow as part of its regular training," the ministry said in a statement.
Seoul's navy and coastguard have for years staged joint exercises near Dokdo but those do not involve live-fire drills.
Tomorrow's naval drill by the navy is not part of the biannual exercises.
The row escalated in 2012 following a surprise visit by then South Korean President Lee Myung-Bak.
Tension escalated earlier this year after Japan moved to revise school textbooks to strengthen its historical claim to the islets.
Relations between the South and Japan are currently at their lowest ebb for years, mired in emotive disputes linked to Japan's 1910-45 colonial rule, including the islet dispute.
Many South Koreans believe Japan failed to properly atone for abuses carried out during the Japanese occupation.
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