Several hundred Australian and New Zealanders, including dozens of Korean War veterans, braved freezing conditions to attend the service at Seoul's South Korean War Memorial
"In our silence today we remember those we have lost," Ms Gillard said.
"Each of them one of us; each of them lost to us now."
Ms Gillard paid particular honour to Korean war veterans.
"Australians do remember them; Australians will remember them."
The service coincides with the 60th anniversary of the battle of Kapyong, one of Australia's major engagement of the Korean war and dubbed the forgotten battle of the forgotten war.
The April 1951 battle saw a small number of Australian, New Zealand, Canadian and British troops repel a massive Chinese force trying to invade Seoul.
Thirty-two Australians died, 59 were wounded and three taken prisoner during the battle.
Later on Monday, Ms Gillard will have a bilateral meeting with South Korean President Lee Myung-bak at the so-called Blue House.
She will also meet with Prime Minister Kim Hwang-Sik.
