South Korea's Yonhap news agency, quoting an unnamed source, said that the 65-year-old Kim seemed to be testing them by taking them to military inspections to see how they performed.

"By taking them out to inspections of military units, he seems to check who will fit better," as his successor, the source was quoted as saying.

Kim has three sons: Jong-Nam, 36, Jong-Chul, 26, and Jong-Woon, 23, but the eldest's star has waned after he was embarrassingly deported from Japan in 2001 while trying to enter the country on a forged Dominican passport, Yonhap said.

"Chairman Kim has yet to determine who is to succeed him, but he is still believed to point at Jong-Chul or Jong-Woon," the source was quoted as saying.

The two men received secret military education at the North's prestigious Kim Il-Sung University over recent years, apparently to prepare them for succession, the report said.

Kim Jong-Il inherited power from his father, Kim Il-Sung, who founded the North in 1948 and died in 1994, creating the world's first communist dynasty.

In 2005 Kim banned discussion of succession, fearing it could make him a lame duck leader, Yonhap said.

The report also speculated that his health might be worsening, saying Kim had diabetes and problems with his heart and liver.

Kim had attended 23 publicity events so far this year, half as many as expected, said Yonhap, which monitors North Korean state media.

North Korea could see a three-way power struggle between a group supporting Jong-Chul and Jong-Woon, a group backing Jong-Nam, and supporters of Kim's new wife, Kim Ok, the report said.

Yonhap reported last year that the North's leader took Kim Ok, a musician-turned-secretary, as his new wife.

Jong-Nam was born to actress Sung Hae-Rim, who reportedly died of an unidentified disease in a Moscow hospital in 2002.

Jong-Chul and Jong-Woon were born to a different mother, Ko Yong-Hui, a former dancer who died of lung cancer in 2004.