Announcing Pak's removal, the official KCNA news agency gave no reason for the move.
The assembly is a largely rubber-stamp body that meets once or twice a year to approve budgets or discuss policy.
Pak, who still had a year left in office, has been replaced as prime minister by Kim Yong-il, previously North Korea's minister of land and marine transport.
In 2003 Pak was promoted to the premiership from his job as minister of chemical industries in a move that was seen at the time as a sign the North was attempting to revive its moribund economy.
Two years later Pak paid a much publicised visit to China to study economic reforms in North Korea's giant neighbour and closest ally.
Kim Jong-il, centre, attended Wednesday's opening
session of the Supreme People's Assembly [Reuters]
The post of prime minister is among several high-ranking positions in the North Korean government, although virtually all power lies in the hands Kim Jong-il, whose policies strongly favour the armed forces.
Officially the country's second in command is Kim Yong-nam, the president of the Presidium of the Supreme People's Assembly.
Pak's dismissal comes amid intense diplomacy aimed at getting North Korea to meet a deadline of Saturday to shut down its main nuclear reactor under a six-nation disarmament agreement in exchange for aid and political concessions.
During Wednesday's meeting of the assembly, delegates heard reports on the budget with officials claiming success in meeting goals for revenue and spending, although no money figures were given.
Vice Premier Kwak Pom-gi, who led the session instead of the ousted Pak, said the country's main economic goal this year was to "improve the standard of people's living" along with the "modernization of the national economy," according to KCNA.
North Korea is one of the poorest countries in the world.
Aid agencies say as many as 2 million people are estimated to have died from famine that began in the 1990s blamed on a combination of mismanagement and natural disasters.