Turkey says it will end co-operation with the US in Iraq if the Americans continue with their offensive in the northern Iraqi town of Talafar.
The US has been pounding Talafar, which it says has become a haven for insurgents
Ankara is concerned about the plight of the large Turkmen population there, some of whom have been killed.
US and Iraqi troops last week began a major operation against Talafar - a suspected haven for foreign fighters entering Iraq from Syria.
On Friday Turkey's foreign ministry urged the US to halt the offensive.
"What is being done there is harming the civilian population, that it is wrong," Foreign Minister Abdullah Gul said on Monday.
He added that if the operation continues in Talafar, "Turkey's cooperation on issues regarding Iraq will come to a total stop".
Turkey is a major Nato ally of the US.
The BBC's Jonny Dymond in Ankara says an end to Turkish cooperation in Iraq could have a serious impact.
As well as supplying logistical help for the US armed forces there, Turkey is a major trade and supply route into the country.
The Turkish airbase of Incirlik has been used by the US to rotate its troops in and out of Iraq.
Our correspondent adds that it is not clear yet quite what Turkey means by ending cooperation - but the US needs Turkey enough for it to heed the minister's warning.
The Turks regards northern Iraq as part of their sphere of influence - not only because of its close ethnic and linguistic ties with Iraq's Turkmen but because of the presence of large Kurdish populations on both sides of the border.
It is unclear how many people have been killed in the US offensive in Talafar.
But reports suggest that some Turkmen are among the victims, and that many thousands have been forced to flee.
The US ambassador to Turkey, Eric Edelman, has said the American forces are doing their best to keep civilian losses to a minimum as they fight the Iraqi insurgents.