The move comes following the death of university student Otto Warmbier, who was returned to the U.S. In a coma after spending time in a North Korean prison.
A federal notification is scheduled to be published next week and new travel restrictions could come into place 30 days after that.
"The safety and security of US citizens overseas is one of our highest priorities," State Department Spokesperson Heather Nauert said.
Once in effect, US passports will be invalid for travel to, through and in North Korea, and individuals will be required to obtain a passport with a special validation in order to travel to or within North Korea, she said.
Individuals seeking to travel to North Korea for certain limited humanitarian or other purposes may apply to the Department of State for a special validation passport, the spokesperson said.
Apart from the treatment of Americans in North Korea, tension has been increasing over North Korea's nuclear programme.
This month North Korea announced it had successfully tested what it said was its first intercontinental ballistic missile, the latest in a series of tests in defiance of a UN ban.
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