Chinese tech giant Huawei’s equipment is to be stripped from the UK’s 5G network by 2027.
The move could add billions to the cost to its delivery, as well as potentially delaying the high-speed mobile network.
Culture Secretary Oliver Dowden told the House of Commons that from next year, telecoms firms will be banned from purchasing new 5G equipment from Huawei.
It comes amid fears the Chinese state could put pressure on the company to share information on the UK's 5G communications.
Huawei said it was disappointed by the move and claimed decisions on its future in the UK had become politicised.
Mr Dowden told MPs: "This has not been an easy decision, but it is the right one for the UK’s telecoms networks, for our national security and our economy – both now and in the long run."
Mobile network providers are also being ordered to shift away from the purchase of Huawei’s equipment for full-fibre broadband networks over a period lasting up to two years.
The decisions were taken at a meeting of the National Security Council chaired by Boris Johnson on Tuesday morning.
It followed an assessment of the impact of US sanctions by experts from the National Cyber Security Centre (NCSC).
Mr Dowden said: "The new US measures restrict Huawei’s ability to produce important products using US technology or software. The National Cyber Security Centre has reviewed the consequences of the US’ actions.
"The NCSC has now reported to ministers that they have significantly changed their security assessment of Huawei’s presence in the UK’s 5G network.
"Given the uncertainty that this creates around Huawei’s supply chain, the UK can no longer be confident it will be able to guarantee the security of future Huawei 5G equipment affected by the change in US foreign direct-product rules."
WATCH: Mr Dowden made the announcement in the House of Commons.
Mr Dowden added the moves could delay the rollout of 5G by two to three years and potentially add £2 billion to the overall cost.
In January, the Government announced Huawei was to be given a limited role in the UK's 5G network.
The Government said in a statement at the time that it would only ban "high-risk vendors” from sensitive parts of the UK’s 5G networks, including access to "sensitive geographic locations" such as military bases and nuclear sites.
Defence Select Committee chairman Tobias Ellwood said the Government should "expect repercussions from China".
Tory former Cabinet minister David Jones highlighted China’s ambassador to the UK Liu Xiaoming’s warning of “consequences” if the UK banned Huawei.
Mr Dowden said: "This Government will not be cowed by the comments of any other country."
Huawei UK spokesman Ed Brewster said the "disappointing decision" is "bad news for anyone in the UK with a mobile phone".
"We remain confident that the new US restrictions would not have affected the resilience or security of the products we supply to the UK," he said.
The company has always denied it would pose any security risk.
Cover image: PA.