BANGKOK (Reuters) - Thailand's military government said on Monday it will prosecute cases concerning national security and royal insult in civilian courts instead of military courts, a change a rights group said was "window dressing" before a U.N. review.

There has been a sharp rise in the number of prosecutions for dissent and royal insult since the military seized power in a 2014 coup with the junta opting to try such cases in military courts.

The military declared when it took over it considered violations of a strict lese-majeste law, which makes it illegal for anyone to "defame, insult or threaten the king, the queen, heir-apparent or regent", a matter of national security.

Those convicted under the law face up to 15 years in prison.

Students and democracy activists have also been prosecuted in military courts for campaigning against military rule under a sedition law.

According to an order signed by junta chief Prayuth Chan-ocha, future cases relating to national security and lese-majeste would be prosecuted in civilian courts because of "an improving situation and cooperation from the public for the past two years".

"All security cases effective September 12 will be dealt with by civilian courts except cases that are currently in progress," Deputy Prime Minister Wissanu Kreag-ngam told reporters on Tuesday.

Some 1,500 cases have been tried in military courts since the junta seized power in May 2014. Of those, 1,000 have been completed and some 500 cases are still pending, said Wissanu.

The United States and European Union both downgraded diplomatic ties with Thailand following the 2014 coup. Since then they, as well as the United Nations, have on occasion expressed concern about human rights.

Thailand defends its human rights record saying prosecutions are undertaken according to its laws.

Rights groups say the change was aimed at addressing such concerns and would not make a big difference as civilian courts were known to hand out heavy sentences in cases of royal insult.

"This decision is just window dressing ahead of Thailand's Universal Periodic Review (UPR) in front of the U.N. Human Rights Council later this month," said Sunai Phasuk, Thailand researcher at Human Rights Watch.

Thailand defended its human rights record in front of the Human Rights Council in May this year after some member states noted what they saw as a deteriorating rights situation.

Military courts will continue to hear cases in Thailand's three southern provinces bordering Malaysia where a state of emergency is in place, Defence Minister Prawit Wongsuwan told reporters.

Resistance to central government rule has existed for decades in the far-south provinces of Pattani, Yala and Narathiwat, but transformed into a violent insurgency in 2004.

More than 6,500 people have been killed since then in bombings and shootings that take place almost daily.

(Reporting by Amy Sawitta Lefevre, Cod Satrusayang, Panarat Thepgumpanat and Pracha Hariraksapitak; Editing by Robert Birsel and Amy Sawitta Lefevre)