"Payments to and through the Palestinian Authority are not authorised for the time being," European Commission spokeswoman Emma Udwin told reporters in Brussels.
A decision on future EU assistance to the Palestinian government will depend on whether Hamas meet three key conditions, including a decision to renounce violence, recognise Israel and abide by past Israeli-Palestinian peace deals, Udwin said.
If Hamas failed to meet such demands, the EU will "need to develop new strategies and measures on how to address the new situation," she added.
EU foreign ministers are to decide on future aid to the Palestinians at a meeting in Luxembourg next Monday.
Hamas reacted angrily, saying the decision amounted to collective punishment and would harm the Palestinian people rather than its government.
"The European Union should have respected the democratic choice of the Palestinian people instead of punishing them," Parliament Secretary Mahmoud Rahami, a senior Hamas leader in the West Bank, told Deutsche Presse-Agentur, dpa.
He spoke as violence between Israel and the Gaza Strip intensified, with Palestinian militants firing locally-produced rockets into southern Israel from the coastal salient and Israel retaliating Friday with air strikes, artillery fire and shelling by navy boats.
Israeli soldiers also shot dead a 22-year-old Palestinian during an arrest raid in the northern West Bank city of Nablus. The Israeli army said he was one of several gunmen who opened fire at the arrest force, but Palestinian officials said he was an unarmed neighbour.
One of four targets hit in the Gaza Strip overnight was a helicopter landing pad several hundred metres from Palestinian President Mahmoud Abbas' office and residence in western Gaza City.
Witnesses reported a large explosion, but security officials said no one was injured.
Abbas arrived in Gaza City Thursday night for talks late Friday with Haniya on the acute financial crisis of his government and on a dispute over control over the security forces.
The European Commission spokeswoman stressed that the temporary suspension of aid did not "prejudge" a decision EU ministers would make in Luxembourg Monday.
EU foreign ministers meeting in Luxembourg on Monday will debate the future of the EU's aid to Palestinians but diplomats said the bloc was split on what to do next.
The US, EU, Russia and the United Nations - members of the international quartet which is seeking to end Israeli-Palestinian hostilities - have warned repeatedly since Hamas' election victory that the group could face an aid cut-off if it continues its hardline stance.
A quartet statement earlier this year said all donors were reviewing aid to the Palestinians following the Hamas victory.
But several EU countries have voiced concerns that any EU aid suspension would worsen the economic situation in Gaza and the West Bank.
Despite the current cut-off in direct aid to the Palestinian Authority, EU assistance to meet the "basic needs" of the Palestinian people would continue, diplomats said.
The EU is the biggest donor to the Palestinian Authority, with member states and the European Commission putting aside around 500 million euros a year since 2003.
Earlier this year, the EU governments rushed 120 million euros worth of assistance to the transitional Palestinian government, insisting the money must be spent before the new Hamas government took over last week.
The EU - like the US - has blacklisted Hamas as a terrorist group and says there will be no contact with the organization unless it changes its stance.
But EU foreign and security policy chief Javier Solana said earlier this week that the new Hamas-led government to fail should be given a chance.
Solana, speaking to the European Parliament in Strasbourg, said Hamas was not currently a "valid partner" for the EU but added: "the EU does not want on principle to see the Hamas government fail."
The UN and human rights agencies have warned that food stocks in the Gaza strip are running out and salaries government employees are unpaid due to Israel's cutting off of trade routes into the Palestinian areas and withholding of tax revenues and customs duties.
On Friday, Israel reopened a key goods crossing to the Gaza Strip for several hours to allow the entry of humanitarian aid. The Karni commercial crossing has been closed for much of the past three months, because Israeli authorities said they have intelligence information that militants are planning attacks on the crossing.
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