Abe hopes to capitalise on a weak and fractured opposition to sweep back into power, as polls show him regaining ground after a series of scandals.
"I will dissolve the House of Representatives on the 28th" of September, Abe told reporters, a precursor to a general election. The prime minister did not give a date for the vote but it is widely expected to be October 22.
Surveys suggest voters approve of nationalist Abe's hardline stance on North Korea, which fired two missiles over the country in the space of a month and has threatened to "sink" Japan.
"The election, which is the core of democracy, should not be influenced by the threats of North Korea," stressed Abe, 63.
"Rather, by holding an election, I want to seek a public mandate regarding (the government's) handling of the North Korean issues," he added.
According to a weekend poll in business daily Nikkei, 44 percent of voters plan to vote for Abe's conservative Liberal Democratic Party (LDP), while only eight percent favoured the main opposition Democratic Party.
Nevertheless, one fifth of those polled said they were still undecided, potentially opening the door for gains by a new party formed by allies of the popular mayor of Tokyo Yuriko Koike, which will field dozens of candidates.
Koike's Tomin First no Kai (Tokyo Residents First) party humiliated Abe and the LDP in local elections in July, but analysts say the new grouping has not had time to lay a national foundation to mount a serious challenge to the prime minister.
In an apparent bid to steal Abe's limelight, Koike went before the cameras just hours before his announcement to announce she was creating a national political party called "Kibo no To" (Party of Hope).
"Japan is facing a difficult time considering the situation in North Korea. Economically, the world is making a big move while Japan's presence is gradually declining," said Koike.
"Can we continue letting (the existing lawmakers) handle politics?"
But Jeff Kingston, director of Asian Studies at Temple University in Japan, said there was "no opposition worthy of the name in Japan".
"The LDP is a giant among dwarves. It would take a major scandal to derail the Abe express," said the analyst.
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Political vacuum
The winner of the expected snap election faces a daunting in-tray of challenges ranging from an unprecedented crisis with North Korea to reviving the once world-beating Japanese economy.
In addition to threats to destroy Japan, Pyongyang has fired two missiles over the northern island of Hokkaido in the space of less than a month.
However, the North Korea crisis appears to have given the hawkish Abe a welcome boost in the polls following a series of scandals, including allegations he improperly favoured a friend in a business deal.
Despite a recent run of growth, the election winner will also have to contend with a sluggish economy, as the heavily indebted country grapples with a low birth rate and a shrinking labour force.
Although Abe is expected to triumph in the vote, there are question marks over whether he will retain a two-thirds parliamentary majority needed to reform the constitution to strengthen Japan's military, one of his stated priorities.
"Despite the seemingly favourable backdrop for Abe, there are risks in calling a snap election," said Yoel Sano, an analyst at BMI research.
At a time of national crisis over North Korea, Japanese voters may see it as a "cynical and opportunistic move" designed to divert attention from scandals that weighed on Abe's popularity, warned Sano.
Commentator Masao Yora said the election would "create a political vacuum" just when the country needs strong leadership in the face of the threat from Pyongyang.
This "may seem normal in Japan but from abroad, it is difficult to understand", Yora told AFP.
If re-elected, it would be Abe's fourth term.
Abe, the third generation of a powerful political family, appeared to be groomed for power from an early age. He was the country's youngest prime minister when he first won the top job.
Abe was the first world leader to cultivate close relations with US President Donald Trump, meeting the tycoon in Trump Tower even before he was inaugurated.
Five challenges facing Japan
North Korea
North Korea's leader Kim Jong-Un has threatened to "sink" Japan into the sea and blasted two missiles over the northern island of Hokkaido in the space of less than a month.
Both missile launches prompted emergency evacuation orders but, with so little time to seek shelter, many Japanese feel a sense of helplessness in the face of the unpredictable threat from Pyongyang.
Abe has steadily upgraded Japan's military to counter the North's threat, saying the time for talk is over and urging the international community to apply more pressure on Pyongyang.
Adding to the friction between the nations is a simmering anger in Japan after North Korea admitted to kidnapping 13 Japanese nationals in the 1970s and 1980s to train its spies.
Many Japanese suspect more people have been kidnapped and kept alive in North Korea.
On the other side of the conflict, North Korea says Japan has not sufficiently atoned for its brutal colonial rule of the Korean peninsula through the end of World War II.
Demographic time bomb
Domestically, the most pressing issue for Japan is a ticking demographic time bomb that affects all areas of life from the economy to society.
Japan is on its way to becoming the world's first "ultra-aged" country, meaning more than 28 percent of its population will be over 65.
Very low birthrates and an expanding elderly population mean a shrinking workforce is having to pay for the ballooning cost of welfare.
Despite a labour shortage, wages have not risen in a meaningful way and tempered domestic consumption, forcing policymakers to dish out a generous stimulus package to safeguard the fragile economy.
The mix of problems has pushed many young people to postpone marrying and starting a family, only adding to the demographic problem.
The government has done its best to encourage young people to start a family and called on firms to raise wages and help employees achieve a healthy work-life balance. But the efforts have not resulted in significant changes.
As people migrate from the countryside to the cities, experts predict that Japan's regional communities will gradually fade away and urban centres will be swamped by an elderly population.
Economic growth, but slow
Japan has managed six straight quarters of economic growth -- its best run in a decade -- but at a rate far behind Asian competitors such as China and India.
The latest annual growth rate stood at a sluggish 1.3 percent, eking out a slight gain from the 0.9 percent when Abe took power.
Abe has sought to pep up the world's third-biggest economy with a high-profile blitz dubbed "Abenomics", a combination of big government spending and ultra-loose monetary policy from the Bank of Japan.
But while it fattened corporate profits and sent the stock market higher, it has failed in the goal of shrugging off the deflation that has plagued Japan for decades.
Ballooning debt
Japanese government debt is the worst of any industrialised nation, more than double the size of its economy.
Experts have long warned Japan must shrink its debt mountain or face a sharp increase in its borrowing costs and even a risk of default.
But Abe has continued to issue new debt to fund stimulus packages to prop up the lumbering economy.
He has also delayed a second consumption tax hike, a step economists say is needed to rein in debt.
Most of the debt is held by domestic, long-term, institutional players, shielding Tokyo somewhat from moves by fickle foreign investors.
Changing business culture
Japan has struggled to keep pace with globalisation and changing times, especially in its once mighty corporations, which now lag behind their foreign competitors in terms of innovation.
The country's firms have been slow to get women in top positions and have struggled to integrate the older population.
Meanwhile, some traditional male-dominated boardrooms have become scenes of scandals, such as at Toshiba where executives ignored codes of sound governance and hid financial losses.
Abe has attempted to cut red tape and encourage innovation, but critics say reform is proceeding at a snail's pace.
Boosting immigration to reinforce Japan's workforce and ease the population crisis is the subject of much scholarly debate but the idea has never really gained public support.
