Kiir and Machar's forces signed a peace agreement in 2018 that ended five years of civil war.
Implementation of the deal has been slow, and bouts of fighting have continued to kill civilians.
A meeting this month aimed at resolving the rift between Kiir and Machar ended in deadlock.
The stalemate is likely to cause paralysis in the implementation of the peace deal.
Juba
South Sudan's President Salva Kiir has appointed a member of his own party as defence minister, according to a decree read on state media, breaching a peace deal in which the role should be selected by the party of opposition leader Riek Machar.
Kiir fired defence minister Angelina Teny, who is also First Vice President Riek Machar's wife, along with the interior minister this month, re-igniting long-standing disagreements over how the two war veterans share power.
Kiir and Machar's forces signed a peace agreement in 2018 that ended five years of civil war that killed 400,000 people and triggered Africa's biggest refugee crisis since the 1994 Rwandan genocide against the Tutsi.
Implementation of the deal has been slow, and bouts of fighting have continued to kill and displace large numbers of civilians.
Loyal general
According to the decree read on state TV late on Wednesday, Kiir replaced Teny with Chol Thon Balok, a loyal general and former governor of Upper Nile state.
"The appointment of Chol Thon as a minister of defence is unilateral and a new blatant violation of the peace agreement," said Puok Both Baluang, Machar's spokesperson, calling for Teny to be reinstated.
A meeting this month aimed at resolving the rift between Kiir and Machar ended in deadlock.
National election
The stalemate is likely to cause paralysis in the implementation of the peace deal, which is meant to culminate in a national election at the end of 2024, said Boboya James, a policy analyst at the Juba-based Institute of Social Policy and Research.
"(Kiir) wants to have all the powerful institutions," James said. "What he is doing is to consolidate that level of power between now and towards the elections."