Kenya has directed the UN refugee agency to relocate thousands of Somali refugees living in northern region following increased terror threats in the country.

Deputy President William Ruto said the UN High Commission for Refugees (UNHCR) has been given three months to relocate refugees from the Daadab refugee camp, the world's largest refugee settlement to help reduce terror threats.

"The relevant bodies have three months, starting today, to relocate all the refugees from the camp," Ruto directed in Nyeri, central Kenya.

Kenya has for many years generously hosted tens of thousands of Somalis refugees, fleeing fighting from central and southern Somalia whose lives were at substantial risk that requires international protection.

Nairobi, which hosted protracted negotiations that culminated in the formation of the transitional federal government of Somalia, said the refugee situation continues to pose security threats to Kenya and the region apart from the humanitarian crisis.

Ruto said that the camp has been suspected of harboring terrorists who plan and carry out attacks in Kenya.

He said should the refugees not be relocated within the given period, the government will take necessary steps to remove them from the area.

Early in the week, leaders from northern Kenya called on the government to shut down the camp or relocate it to Somalia, saying that it has been used as a breeding point for terrorists.

Ruto's directive came even as more refugees continue flooding the camp especially from the Horn of Africa nation.

Al-Shabaab militia attacked the Garissa University College on April 2, killing at least 148.

The East African nation is also hosting nearly half a million refugees from Somalia and has delayed their repatriation until the security situation in the country improves further.

Kenya blames the influx of refugees and Al-Shabaab insurgents for a string of attacks and kidnappings in Nairobi, Mombasa and northern region towns.