South Korean Foreign Ministry spokesman Shin Bong-Kil in Seoul said, "It breaks our heart that we have to announce this unfortunate news. A body identified to be of an Asian man was found between Baghdad and Fallujah."
"Afterwards, the photo of the body was e-mailed to the South Korean Embassy and was confirmed to be the body of Kim Sun-il."
The body was discovered west of Baghdad by U.S. military police, who then notified the South Korean Embassy.
Kim, an interpreter who was working for a company which distributes supplies to the U.S. military, was kidnapped June 17 in the Fallujah area by the group Jamaat al Tawhid wal Jihad, linked to Jordanian terrorist Abu Musab al-Zarqawi.
South Korea still plans to send 3,000 more troops to Iraq, but they will evacuate civilians "except those who are absolutely necessary as a preventative measure against other attacks," according to a spokesman.
Meanwhile, President Bush called the beheading "barbaric," but hopes South Korea's president Roh Moo Hyun "would understand that the free world cannot be intimidated by the brutal actions of these barbaric people."
Last Wednesday, Kim appeared on the Arab satellite network Al-Jazeera, making a plea for his life, "I don't want to die," he said.
Tuesday, Kim appeared again on Al-Jazeera. This time, he was shown blindfolded and kneeling in an orange jumpsuit with five hooded men behind him.
"This is what your hands have committed," one man read from a statement. "Your army has not come here for the sake of Iraqis, but to serve the cursed America."
According to Al-Jazeera, his captors then beheaded Kim.
A group which was working toward negotiating Kim's release said that the militants had earlier agreed to delay the execution.
Kim, 33, was single and planned to return to his hometown, the city of Pusan, in July for his father's 70th birthday, Reuters reported.
Born in September 1970, Kim graduated with a degree in Arabic from a language school in South Korea, Hankuk University of Foreign Studies, in February 2003.