The 20-year accord came into force on Wednesday, with South Korea's foreign minister and the US ambassador exchanging documents in Seoul.
South Korea is among top five consumers of nuclear energy in the world, and home to 23 nuclear power plants.
However, all of the nuclear fuel in the country is provided by the US.
Seoul has repeatedly urged Washington to allow South Korea to develop uranium enrichment and reprocessing capabilities, citing energy concerns and environmental issues.
The US is opposing the move, fearing that such technology could also be used for weapons-grade nuclear material.
The US government is concerned about sparking the nuclear rivalry between Seoul and North Korea, the country that already conducted three successful nuclear tests.
The latest accord denies South Korea the right to reprocess and enrich the US-origin fuel.
However, Seoul and Washington agreed to establish a high-level committee to discuss the issue, which South Korean officials described as a step towards securing a possible consent from Washington in the future.
South Korea is also seeking to become a key exporter of atomic power plants.
The US ally could also research technologies such as "pyroprocessing" which are generally considered safe from the proliferation standpoint.
dj/kms (dpa, AFP, AP)