North Korea defended tenaciously and showed tactical discipline and flashes of skill in attack as they came within four minutes of forcing a second successive goalless draw following last month's 0-0 stalemate with South Africa.
The team from the hermit state, backed by about 20 flag-waving compatriots in the stands, lived up to their reclusive reputation as they refused to attend the post-match news conference.
Striker Roque Santa Cruz saved Paraguay's blushes by scoring an 86th minute penalty given away by Nam Song-chol who, under no pressure from an opponent, used his hand to control a pass in a moment of naivety.
North Korea coach Kim Jong-Hun has given little away about tactics but it seemed clear on Saturday they will try to frustrate first round World Cup opponents Brazil, Ivory Coast and Portugal.
Although their defence was well-organised and hard-working, they often looked lightweight in direct physical challenges.
They also had difficulty playing their way out of defence with goalkeeper Ri Myong-guk repeatedly pumping long kicks into the Paraguay half.
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"They defend very well, create a lot of complications and are very fast on the counter-attack," said Paraguay coach Gerardo Martino, whose team have reached their fourth successive World Cup.
"This is a very organised team who work very hard," added Martino, who was also impressed by the lack of North Korean protests when decisions went against them, including the penalty.
"I think this is common in all the teams from the Far East, you see it with South Korea, China, Japan, where the respect for authority is something which stands out. They never protest."
Santa Cruz said: "It's very tough when you get teams like that and North Korea is one of the teams where the game is very hard to win."
Brazil, in particular, struggle against packed defences and were held to goalless draws at home by Bolivia, Venezuela and Colombia in South American qualifiers.
The match was an odd affair, played on a pitch with a small stand on one side in the atmosphere of a minor league game.
For much of the contest it was possible to hear Martino yelling instructions to his players although his counterpart was almost silent.
North Korea are holding a 12-day training camp in the Swiss mountain resort of Anzere.
Anzere's director of tourism David Chabbey said he believed it was positive exposure despite the North Korean government's poor human rights record.
"For us it's important to be in the media," he told Reuters. "As long as we're in the media, it's good and it's sport, we don't talk about politics.
"The benefits will be good, there's a lot of interest in North Korea, they're an interesting team."
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