The seven members of BTS are aged between 24 and 29
The group told fans during a televised dinner celebrating their anniversary that they would be pursuing solo projects.
Band member Jimin said the group had been going through a "rough patch".
"We're trying to find our identity and that's an exhausting and long process," he explained.
BTS made the announcement on Tuesday during their annual FESTA dinner, which saw the group reminisce and discuss the future.
Their whole conversation, which lasted more than an hour, was uploaded to their official YouTube channel.
An English translation showed one member calling the break a "hiatus" - but a representative for the band later disputed that.
"To be clear, they are not on hiatus but will take time to explore some solo projects at this time and remain active in various different formats," said Hybe, the entertainment company that manages BTS.
The FESTA dinner was scheduled to celebrate the founding of the Grammy-nominated group, which is made up of RM, Jungkook, Jin, Jimin, Suga, J-Hope and V.
During the conversation, RM said that while they had achieved a great deal as BTS, the individual members needed to grow and mature as individuals.
"I always thought that BTS was different from other groups, but the problem with K-pop and the whole idol system is that they don't give you time to mature," he said.
"You have to keep producing music and keep doing something."
The singer added that he now wanted to take the time to consider the future of BTS as a group and as individuals.
The group recently joined White House press secretary Karine Jean-Pierre during the daily briefing
Other members agreed, adding that going on a break was a difficult decision.
"We can't help but think of our fans no matter what, we want to be the kind of artists that are remembered by our fans," Jimin said.
"I think that's why we're going through a rough patch right now, we're trying to find our identity and that's an exhausting and long process."
V told fans the group was not splitting for good, adding that they would get back together "later, when we gather again as a group, that synergy will be like no other".
BTS, whose ages range from 24 to 29, released their debut EP in 2013.
Their biggest hits include Dynamite, Butter and the Coldplay collaboration My Universe - all of which reached number three in the UK singles chart.
BTS were named as the world's best-selling artists of 2021 in a chart recently compiled by music industry body the IFPI.
Earlier this month, the group released the music video for Yet To Come (The Most Beautiful Moment) - the title track of their new compilation album Proof.
-- Courtesy of BBC Sport