The rescue attempt occurred a week after the cargo ship, Samho Jewelry, was hijacked by Somali pirates. The ship had eight South Koreans, two Indonesians and 11 people from Myanmar and was carrying chemicals from the UAE towards Sri Lanka.
Eight pirates were killed in the rescue mission, South Korea said.
South Korea launched a rescue operation before dawn with a Lynx helicopter providing covering fire and a South Korean destroyer, when the pirates left the vessel to hijack a Mongolian ship nearby, media reports stated.
Three of our soldiers suffered light scratches on their bodies as they were fired upon by pirates on Tuesday, Col. Lee told BBC.
The captain of the ship had been shot but his injuries were not life threatening, he added. The captain had been airlifted to a hospital nearby.
South Korea is a part of an anti-piracy patrol in the area.
However, most often countries refrain from storming pirated vessels as it might endanger the lives of the hostages.
We will not tolerate any behavior that threatens the lives and safety of our people in the future, South Korean President Lee Myung-bak said in a televised statement.
The South Korean government made is clear that they would not be bullied or give in ransom threats by pirates in the future.
Some regard this strong response to the pirates operation as a way of making up for its delayed reaction when attacked by North Korean forces last year.
Critics said Lee's military was too slow and weak in its response to the attack, which killed two marines and two civilians, the Washington Post said.
Somalia has not seen a peaceful regime since 1991, and has been marked by interclan fighting, piracy, bandits and civil war.
In 2000, the Transitional National Government was recognized as a formal government by the international community. Even so, there has been a constant stream of wars and fights within the nation and it is currently ruled by the Traditional Federal Government, who believe in a special charter of rules instead of democracy.
Years of insecure earnings and civil war made piracy a major source of livelihood in Somalia over the past couple of years.
The United Nations said that piracy off the Somali coast has been a threat to international shipping since the second phase of its Civil War.
The geographical position of Somalia gives the country a leg up in piracy. Somalia has the longest coastline in Africa, and is surrounded by the Indian Ocean.
The United Nations is particularly concerned about the rise in piracy in the region, particularly as much of its trade occurs by sea. Piracy has increased shipping costs and ships sailing through these regions now often require a military escort.
More people were taken hostage at sea in 2010 than in any year on record, the International Chamber of Commerce (ICC) International Maritime Bureau's (IMB) global piracy report said.
About 53 ships were hijacked during the year, and hijackings off the coast of Somalia accounted for 92 percent of all ship seizures during the year, the report said.
A total of 28 vessels and 638 hostages were still being held for ransom by Somali pirates as of 31 Dec 2010, it added.
Somali pirates are now also expanding their grasp beyond the territorial waters.
Last year, pirates attacked vessels in the Red Sea, hijacking a chemical tanker - the first such attack of its kind in the region.
GREEK SHIP SEIZED
A Greek-owned bulk carrier was hijacked and another Greek vessel that had been held since July was released earlier this week, Reuters reported.
The merchant vessel and its 24-member Filipino crew was on its way to India from Jordan, when it was seized on Monday, the report said, citing naval forces.
A pirate who identified himself as Farah told Reuters by telephone that a ransom had been paid for the MV Motivator. It was not immediately possible to verify the report, Reuters added.
Pirates generally keep the vessel unharmed for most part in return for a ransom. However, attempts to forcibly rescue these vessels could result in damages to the ship as well as the crew.