The exercise, dubbed Caucasus Frontier 2008, involves units of the North Caucasus Military District, mainly the 58th Army, the 4th Air Force Army, Interior Ministry troops, and border guards.
Lt. Col. Andrei Bobrun, an aide to the commander of the North Caucasus military district, said the exercise involves some 8,000 military personnel, about 700 combat vehicles and over 30 aircraft.
The main goal of the exercise, he said, is to practice interoperability between federal troops, interior ministry's troops, border guards, and the Air Force in special operations against militants and the defense of Russia's state borders.
The exercise will mostly take place on the territory of Chechnya, North Ossetia, Ingushetia, Kabardino-Balkaria, and Karachayevo-Circassia.
According to statistics, 80% of terrorism-related crimes in Russia occur in the Southern Federal District, which includes the North Caucasus republics of Chechnya, Daghestan and Ingushetia.
Meanwhile, another large-scale military exercise began in the region on Tuesday as Georgia and the United States started Immediate Response 2008 near Georgia's capital, Tbilisi.
A total of 1,650 personnel, including troops from Armenia, Azerbaijan and Ukraine, are taking part in the $8-million drills, planned by the U.S. Armed Forces European Command and financed by the U.S. Defense Department.
Relations between Russia and Georgia plunged to a new low recently against the backdrop of outbreaks of violence in Abkhazia and South Ossetia, with the two countries trading accusations of provoking violence.