The rocket carrying the test satellite was launched to assess the satellite’s photography and data transmission systems, state media said.
North Korea has carried out an "important final-stage test" for the development of a spy satellite, which it will complete by April next year, state media said.
Monday's report comes a day after Seoul's military said it had detected launches by Pyongyang of two medium-range ballistic missiles, the North's latest in a year of unprecedented weapons tests.
Analysts say developing such a satellite would provide North Korea with cover for testing banned intercontinental ballistic missiles (ICBMs), as they share much of the same technology.
The launches were "an important final-stage test for the development of (a) reconnaissance satellite", a spokesperson with the North's National Aerospace Development Administration (NADA) said, according to the official Korean Central News Agency on Monday.
Conducted from Sohae Satellite Launching Ground in Tongchang-ri, Sunday's test confirmed "important technical indices" including camera operation in space, and data processing and transmission capabilities of communication devices.
State media also said the vehicle carrying the "test-piece" satellite – which included cameras, image transmitters and receivers, control devices and batteries – reached an altitude of 500 kilometres (311 miles) when it was fired at a high angle.
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"The NADA said this is an important success which has gone through the final gateway process of the launch of (a) reconnaissance satellite," the spokesman said, adding that preparations will be completed by April.
Rodong Sinmun, the official newspaper of North Korea's ruling Workers' Party, carried two black-and-white photographs that appeared to show South Korea seen from space.
The development of a military reconnaissance satellite was one of Pyongyang's key defence projects outlined by North Korean leader Kim Jong Un last year.
Pyongyang carried out two launches earlier this year, claiming it was testing components for a reconnaissance satellite, which the United States and South Korea said likely involved components of its new Hwasong-17 intercontinental ballistic missile.
'Irreversible' nuclear state
On Thursday, the North tested a "high-thrust solid-fuel motor" at the Sohae launch site, which analysts say would allow quicker and more mobile launches of ballistic missiles.
All of Pyongyang's known ICBMs are liquid-fuelled, and solid-fuel ICBMs that can be launched from land or submarines are on Kim's wish list revealed last year.
Kim, who has doubled down on his banned weapons programmes since nuclear talks collapsed in 2019, said this year he wants the North to have the world's most powerful nuclear force, and declared his country an "irreversible" nuclear state.
The United States and South Korea have warned for months that Pyongyang is preparing to conduct its seventh nuclear test.
North Korea is under multiple UN Security Council sanctions over its nuclear and missile activity since 2006.
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