Tokyo sources revealed the upgrade, which will be discussed in the Japanese parliament, will bolster rocket systems as well as improving accuracy of its missiles.
It comes after the hermit state has test fired at least 21 ballistic missile and two nuclear tests so far this year.
Kim Jong-un’s nation has also fired missiles into the Sea of Japan, sparking tensions between the two superpowers.
But last weekend Pyongyang conducted a failed test on an intermediate ballistic missile, the US military claimed.
Officials say the test allegedly took place near the north-western city of Kusong at 4.33BST on Saturday, as the totalitarian state continues attempts to develop long range weapons.
North Korean state media made no mention of a test or launch on Saturday but carried an article published threatening the US for “hostile acts hurting the dignity of the supreme leadership of the DPRK”.
The launch comes despite North Korea being banned from testing the potentially deadly weapons.
US Navy Commander Gary Ross, a Pentagon spokesman, said: “We strongly condemn this and North Korea”s other recent missile tests.
“We intend to raise our concerns at the UN to bolster international resolve in holding the DPRK accountable for these actions.”
The despotic leader has also chastised Britain’s plans to conduct joint air operations in South Korea.
Furious Kim has warned the UK not to go forward with the operation, condemning it as a hostile act.
A spokesman for state-owned Korean Central News agency warned: “This is a never-to-be pardoned serious challenge to peace and security.”
The spokesman also said Britain should “immediately withdraw its decision to take part in the military drills for aggression”.