The injured soldier left his guard post in front of Panmungak, on the heavily guarded border inside the DMZ, and moved toward Freedom House on the South Korean side, CNN reported. There was no peace treaty.
The drill is also in response to North Korean nuclear and missile provocations, the South's military said, and to show any such developments by Pyongyang can be repelled with "overwhelming force".
President Donald Trump attempted to visit the DMZ last week during his trip to South Korea, but his helicopter had to turn back because of bad weather.
In 1984, North Korean and U.N. Command soldiers traded gunfire after a Soviet citizen defected by sprinting to the South Korean sector of the truce village.
It's located inside the 4-kilometer-wide (2 1/2-mile-wide) mine-strewn Demilitarized Zone, whose northern and southern boundaries are guarded by barbed wire fences and combat troops.
The defector's rank was not immediately clear.
It's rare for a North Korean soldier to defect via Panmunjom and be shot by fellow North Korean soldiers.
It's the third time this year that a North Korean soldier defected. "Just as South Korea stands firm on the comfort women issue and continues to deal with it separately even while seeking to fix relations with Japan, this only means China is using a two-track strategy on THAAD". From January to August 2017, 780 North Koreans escaped to South Korea, according to officials in Seoul.
Saturday's meeting came about two months after the North staged its sixth and most powerful nuclear test so far on September 3. It has conducted a series of tests with the last being on September 3.
The defection came during escalated tensions between the North and the South and almost a week after President Trump visited Seoul for his five-country Asia tour. The three no's are South Korea's agreement not to deploy additional THAAD batteries, not to participate in the U.S. missile defense network and not to forge a trilateral military alliance with the USA and Japan.
Separately on Monday, a 58-year-old man from Louisiana was arrested Monday when he entered a controlled area in Yeoncheon County on the North Korea border.