By Steve Slater

LONDON (Reuters) - South Korea faces off against the northern neighbor it is still technically at war with at Olympic table tennis on Saturday in what is sure to be one of the most politically charged contests at London 2012.

Uncertainty about secretive North Korea and its new leader and rumored development of nuclear weapons have created a tense backdrop for the six players preparing to meet in the team event.

Table tennis is one of the most popular sports in both countries and has in the past led sporting efforts to bring the two nations closer.

However, a furor a week ago when the South Korean flag was mistakenly shown before the North's women played a soccer match showed how far tensions have increased since the two countries marched together in Athens eight years ago.

North Korea's table tennis coach complained to organizers here that photographers from the South had disrupted his training session.

There is potential for "ping pong diplomacy" to help mend relations, however, as it has done in the past.

South Korea's 2004 Olympic champion Ryu Seung-min lined up alongside North Korean Kim Hyok-bong at the Qatar Peace and Sport Cup in November, and they won their game.

On Saturday, they will be on opposite sides of the net in the first round of the competition at London's ExCel Centre.

The two countries are still technically at war as no peace treaty was ever signed after their 1950-53 war and the border between them is the most heavily fortified in the world.

Concern has grown that North Korea could be the flashpoint for a major international incident after 29-year-old Kim Jong Un took power following the death of his father Kim Jong Il in December.

The two countries have been on divergent paths since the war. South Korea, with a population of some 49 million, is Asia's fourth biggest economy and has some of the region's highest living standards.

The North, home to 24 million, is an isolated state run by a dynasty of dictators, cut off from the rest of the world by strict controls over any form of communication, with a decaying economy and chronic poverty.

Sport has often reflected the state of relations between the two.

When Seoul hosted the Olympics in 1988, the North boycotted the Games.

Yet three years later Korea competed as a single team at the 1991 table tennis world championships, using a Korean "Unification Flag" for the first time.

MEDALS SUCCESS

South and North Korea marched together at the opening ceremonies of the 2000 Sydney and 2004 Athens Olympics, though they competed as separate teams.

The Olympics is supposed to be a politics-free zone but fights between bitter enemies have been played out, most notably in a 1956 water polo meeting between Hungary and the Soviet Union that went down as the "blood in the water" match.

Both South and North are enjoying success at London 2012.

South Korea are third in the medals table, having won seven golds, and North Korea are in eighth spot with four golds.

A combined country would comfortably be in third. Both have won judo golds, the North have won in weightlifting and the South have topped the podium in archery, fencing and shooting.

The official KCNA North Korean news service said there was delight in Pyongyang at the medal haul.

"I felt refreshed to see the successful performance of DPRK weightlifters on TV. It was so ridiculous for Western media to guess that the DPRK would snatch only one silver medal at the London Olympiad," Kim Chang Bom from Pyongyang told KCNA.

Winning athletes can face a life of luxury when they return, receiving cash, cars, houses and the coveted membership of the Workers Party of Korea, and typically praise their nation or leader after victory.

The consequences of sporting failure are far less palatable. A South Korean newspaper quoted an intelligence source as saying those who performed badly could be sent to prison camps, though that has been disputed by North Korean athletes.

The table tennis duel is likely to be intense.

South Korea are the second most successful nation in Olympic table tennis, behind powerhouse China, while North Korea rank fifth.

The South are seeded second in the men's team event, which involves three players, and are strong favorites to beat the 11th-seeded North. Ryu joins Joo Saehyuk and Oh Sangeun.

In one of the biggest shocks in the singles competition the North's top player, Kim Hyok-bong, seeded 32, beat sixth-seeded Joo in the third round.

South Korea's coach, Yoo Nam-kyu, warned his team not to take their opponents lightly. "North Korean players have solid basic skills because of their Spartan style of training," he said, according to Yonhap News Agency.

(Additional reporting by Ju-min Park in Seoul; Editing by Clare Fallon)