The United States is cutting off aid to the Central American countries of El Salvador, Guatemala, and Honduras, known collectively as the 'Northern Triangle', the State Department says.
The statement was issued on Saturday - the day after President Donald Trump blasted the countries for sending migrants to the United States.
"We are carrying out the President's direction and ending FY (fiscal year) 2017 and FY 2018 foreign assistance programs for the Northern Triangle," a State Department spokesperson said in the statement. The State Department declined to provide further details or clarify the time periods involved.
The State Department said that it would "engage Congress in the process", an apparent acknowledgement that it will need lawmakers' approval to end the funding.
New Jersey Senator Bob Menendez, the top Democrat on the Senate Foreign Relations Committee, called Trump's order a "reckless announcement" and urged Democrats and Republicans alike to reject it.
"US foreign assistance is not charity; it advances our strategic interests and funds initiatives that protect American citizens," Menendez said in a statement.
Trump claimed on Friday during a trip to Florida that the countries had "set up" caravans of migrants in order to export them into the United States. A surge of asylum seekers from the three countries have sought to enter the United States across its southern border in recent days.
"We were giving them US$500 million. We were paying them tremendous amounts of money, and we're not paying them anymore because they haven't done a thing for us," Trump said.
Trump also threatened on Friday to close the US border with Mexico next week if Mexico does not stop immigrants from reaching the United States, a move that could disrupt millions of legal border crossings and billions of dollars in trade.