SEOUL—The recent cancellation of U.S. college entrance exams in South Korea—the first time SAT tests have been called off nationwide anywhere in the world for suspected cheating—is throwing the spotlight back on the country's hyper-competitive academic environment.

The U.S.-based administrator of the SAT, the most widely used standardized evaluation tool for high-school students applying to American universities, scrapped the May 4 sessions in South Korea three days before the test date after it discovered questions from the...