The European Commission, the EU's executive body, has criticized Libya's decision to suspend issuing visas to citizens from the bloc's Schengen area as "unilateral and disproportionate."
"The Commission also regrets that travelers who legally obtained visas before the suspension measure were refused entry when arriving in Libya," said EU Commissioner for Home Affairs Cecilia Malmstrom.
She added that EU and Schengen countries would discuss the matter this week to "consider the appropriate reaction."
A spokesman for the German Foreign Ministry said the decision by Libya was "regrettable," adding that the government expected the suspension to be cancelled.
The move by Tripoli appears to be in response to an announcement by Swiss authorities on Sunday that 188 Libyans, including leader Moammar Gadhafi and his family, are banned from visiting Switzerland.
While Switzerland is not a member of the EU, it is one of the 25 European countries in the border-free Schengen area. Citizens of Great Britain, Ireland, Cyprus, Bulgaria and Romania, which are EU members but not in the Schengen zone, were exempt from the decision.
Relations between Libya and Switzerland have been tense since 2008, when police in Geneva questioned one of Gaddafi's sons, Hannibal, and his wife, after a complaint from hotel staff that he had mistreated them.
That event led to Libya halting oil exports to Switzerland and withdrawing some $5 billion (3.7 billion euros) in assets from Swiss banks.
The quarrel threatens to complicate business ties between Libya and the EU. Italian diplomat Francesca Tardioli has said that some Europeans had been kept waiting for hours at the airport in the Libyan capital, while several with valid visas for Libya had to fly back to their home countries.
Editor: Nancy Isenson