South Korea's military said evidence suggested the man was attempting to defect to the North when he was reported missing from a fisheries boat on Monday about 10km south of the Northern Limit Line (NLL), a disputed demarcation of military control that acts as the de facto maritime boundary between North and South Korea.
The exact reason the 47-year-old official was shot is not known but North Korean troops may have been acting under anti-coronavirus orders, South Korea's military said.
Citing intelligence sources, the military said the unidentified man appeared to have been questioned on a North Korean boat before he was executed on an "order from a superior authority".
Troops in gas masks then doused the body in oil and set it on fire, the South's military said.
"Our military strongly condemns such an atrocity, and strongly demands North Korea provide explanations and punish those who are responsible," General Ahn Young-ho, who is in charge of operations at the Joint Chiefs of Staff, told a briefing.
The US military commander in South Korea said this month that North Korean troops had been given "shoot-to-kill orders" to prevent the coronavirus entering the country.
In July, a man who had defected to South Korea three years ago triggered a coronavirus scare when he crossed back over the heavily monitored border into North Korea, which says it has had no cases of the disease.
His arrival prompted North Korean officials to lock down a border city and quarantine thousands of people over fears he may have had the coronavirus, though the World Health Organization later said his test results were inconclusive.
Last week, South Korean police arrested a defector who they said had tried to return to North Korea by breaking into a military training site in South Korea's border town of Cheorwon.
