Kim fired Gen. Pak Su Il, chief of the General Staff, during a meeting of the ruling Workers' Party central military commission held Wednesday, Korean Central News Agency reported.
He replaced Pak with Vice Marshal Ri Yong Gil, who currently serves as the North's defense minister.
The meeting also dealt with "dismissing, transferring to other posts or newly appointing some leading commanding officers," KCNA said. No reasons were given for the military reshuffle.
Kim analyzed the "hostile" situation on the Korean Peninsula and called for "further stepping up the war preparations of the [Korean People's Army] in an offensive way," the report said.
The meeting comes ahead of a major U.S.-South Korea joint military exercise, Ulchi Freedom Shield, scheduled for later this month. Pyongyang has repeatedly condemned the allies' joint drills as preparation for an invasion, while framing its own nuclear program as an exercise in deterrence and self-defense.
At the meeting, Kim called for the country's "munitions industrial establishments to push ahead with the mass-production of various weapons and equipment in real earnest."
He also ordered North Korea's military to "actively [conduct] actual war drills to efficiently operate newly deployed latest weapons and equipment to ensure that they would display the maximum effect in combat."
Officials agreed on plans to expand the frontline operations of combat units, the KCNA report said, while images showed the North Korean leader pointing at what appeared to be the Seoul area on a map.
Earlier this week, state media reported that Kim toured weapons plants and directed the factories to ramp up production of missile engines, small arms and launcher vehicles.
North Korea also recently held a military parade that showed off its enormous Hwasong-17 and solid-fuel Hwasong-18 intercontinental ballistic missiles as well as new military drones.
Delegations from China and Russia were on hand for the event, a sign that Pyongyang is shoring up its relationships with its two massive neighbors amid a geopolitical divide that has grown in the wake of Russia's invasion of Ukraine.
Moscow and Beijing have repeatedly blocked U.S.-led efforts at the United Nations Security Council to take action against North Korea for its record-setting flurry of weapons tests over the past two years, including the launch of a Hwasong-18 ICBM last month.
Washington, meanwhile, has accused North Korea of supplying weapons to Russia for its war in Ukraine, charges the two countries deny.
During Wednesday's meeting, North Korean officials also discussed plans for a major military parade to mark the 75th anniversary of the country's founding, which falls on Sept. 9.
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