She is a medal prospect for the 2012 Olympics but coaches at British Weight Lifting have become concerned at her "lack of commitment" and say they have taken this step in an attempt to get her training back on track.
Her personal funding will be withdrawn until "at least the end of January" although she will still receive support in the form of physiotherapy and nutritional guidance.
"For Zoe it's not about the money, it's always about the performances," Smith's agent Gab Stone told BBC Sport.
"Losing the funding won't be life changing but if she feels she isn't getting the support that she needs then my great fear is that one of the countries next sporting superstars could be lost.
Smith was expected to compete at the
European Junior Championships
in Cyprus, in November, but the governing body says she arrived at a pre-competition training camp overweight and without a training programme.
British Weight Lifting made the decision that they "could not continue to support an athlete who was not committed to following a structured training programme or ensure they stabilised their body weight" and therefore the teenager was not entered.
The Londoner has been competing predominantly in the 58kg category but has admitted that she struggles to keep to that weight.
Smith needed to lose 5kg in the 10 weeks leading up to the Commonwealth Games and has been tipped to step up to the 63kg division in the future.
"On World Class Programmes, athletes are funded not only because they are good, but because they are willing to work hard to become even better," added Lothian.
Smith has been ordered by British Weight Lifting to commit to five training sessions per week, each at least 90 minutes in length and work with nutritionists to ensure she reaches optimal body weight and conditioning ahead of the Tri-Nations Tournament in Norway on 12 February 2011.
Should she meet the agreed criteria, the Londoner's funding could be reinstated after the completion of the competition.
Smith's main focus for 2011 is likely to be the World Championships in Paris in November, a
for the London Olympics.
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