Norway said it would halt Amazon protection subsidies worth 30m euros ($33m) to Brazil, which it accused of turning its back on the fight against deforestation.
Days after Germany also withdrew money promised for forest protection in Brazil, Norway said the South American nation "broke the agreement" with contributors to the Amazon Fund.
Norway was the single largest donor, giving almost 830m euros to the fund since its creation 11 years ago.
"Brazil broke the agreement with Norway and Germany since suspending the board of directors and the technical committee of the Amazon Fund," Norway's Environment Minister Ola Elvestuen told the Dagens Naeringsliv newspaper.
"They cannot do that without Norway and Germany agreeing," he insisted.
In Sao Paulo, Environment Minister Ricardo Salles said Thursday the Amazon Fund has been "suspended", adding at a meeting with leaders from the BRICS group of countries that the rules governing the fund "are under discussion".
The Amazon is vital for absorbing planet-warming carbon dioxide in the atmosphere and converting it into life-giving oxygen, but concern about the forest has grown since Brazilian President Jair Bolsonaro took office in January.
Bolsonaro has been accused of favouring his supporters in the logging, mining and farming sectors. He has pledged to allow more farming and logging in the Amazon, and to grant more licenses to the mining industry.
Norway's annual contributions to the Amazon Fund are calculated by a technical committee and determined by results achieved in the fight against deforestation.
This year, it was due to pay 30m euros.
"What Brazil has done shows that they no longer wish to stop deforestation," said Elvestuen.
On Saturday, Germany said it would block payment of 35m euros to Brazil for forest conservation and diversity programmes, though it would continue supporting the Amazon Fund.
The following day, Bolsonaro said his country had "no need" for German aid to protect the Amazon.
Brazil's National Institute for Space Research (INPE) said last week that roughly 2 254km2 of Amazon were cleared in July, a hike of 278% from a year earlier.
The Brazilian government said the data was "sensationalist".
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