The UK's chief Brexit negotiator David Frost has withdrawn an invitation to his opposite number Michel Barnier to travel to London for talks on Monday.
It follows the statement by UK Prime Minister Boris Johnson that Britain should prepare for no deal in the trade agreement talks.
The British response comes after the EU leaders' summit yesterday proposed a fresh round of talks, while demanding Britain give ground on key stumbling blocks.
According to a UK spokesperson, Mr Frost spoke to Mr Barnier by phone to update the EU side on the prime minister's statement.
They said: "Lord Frost said that, as the PM had made clear, the European Council's conclusions yesterday had left us without a basis to continue the trade talks without a fundamental change in the EU's approach to these negotiations.
"There was accordingly no basis for negotiations in London as of Monday."
The spokesperson said both men would speak again by phone early next week.
Mr Johnson had said the UK should get ready for an Australian-style exit from the European Union, meaning an exit without a comprehensive deal on future relations ready for the end of the current transition period.
"Unless there's a fundamental change of approach, we're going to go to the Australia solution, and we should do it with great confidence," Mr Johnson said.
He accused Brussels of refusing to engage in serious negotiations.
Mr Johnson said: "From the outset we were totally clear that we wanted nothing more complicated than a Canada-style relationship based on friendship and free trade.
"To judge by the latest EU summit in Brussels, that won't work for our EU partners.
"They want the continued ability to control our legislative freedom, our fisheries in a way that is completely unacceptable to an independent country.
"Since we have only ten weeks until the end of the transition period on 1 January, I have to make judgment about the likely outcome and get us ready.
"Given that they have refused to negotiate seriously for much of the last few months and given that this summit appears explicitly to rule out a Canada-style deal, I've concluded that we should get ready for 1 January with arrangements that are more like Australia's based on simple principles of global free trade."
"If there is a fundamental change in approach, then of course we are always willing to listen, but it didn't seem particularly encouraging from the summit in Brussels," Mr Johnson added.
European Commission President Ursula von der Leyen had earlier said EU negotiators would still travel to London next week to "intensify" talks despite Mr Johnson's comments.
She tweeted: "The EU continues to work for a deal, but not at any price. As planned, our negotiation team will go to London next week to intensify these negotiations."
🇪🇺-🇬🇧 talks: the EU continues to work for a deal, but not at any price.— Ursula von der Leyen (@vonderleyen) October 16, 2020
As planned, our negotiation team will go to London next week to intensify these negotiations.
However, Downing Street said that trade talks between the EU and UK were "over" and there is "no point" in EU chief negotiator Michel Barnier coming to London next week if he is not prepared to change his stance.
Mr Johnson's spokesperson said: "The trade talks are over. The EU have effectively ended them by saying that they do not want to change their negotiating position.
"The EU can either fundamentally change its position or we can leave on Australian terms.
"There is only any point in Michel Barnier coming to London next week if he is prepared to discuss all of the issues on the basis of legal texts in an accelerated way, without the UK being required to make all of the moves.
"Or he is willing to discuss the practicalities of areas such as travel and haulage, which the PM mentioned in his statement.
"If not, there is no point in coming."
Brexit deal can be reached - Taoiseach
Taoiseach Micheál Martin said this afternoon that an EU-UK agreement can be reached despite Mr Johnson's remarks.
He said that within the presentation yesterday by Mr Barnier, his assessment was that "there clearly is room for a deal" and "Europe is very much up for a deal".
Mr Martin added: "From an objective analysis, it would seem to me that anybody looking in would say, there is the basis of an agreement, clearly not an agreement at any price."
Speaking at the end of the two-day EU summit in Brussels, the Taoiseach said there had been progress on a number of issues, but there remained a number of outstanding areas of disagreement, such as fisheries, the level playing field and governance.
He said: "So I would say to the UK government, and indeed I'm speaking as a member state of the EU, we're quite clearly willing to engage and want to engage.
"I think the talks will continue next week, and they should intensify on both sides, and there will have to be give and take."
"We all owe it to the citizens we represent, to do everything we possibly can, to get a sensible trade deal between the UK and Europe that would pave the way for a constructive and effective partnership into the future."