Move comes after Lithuania allowed Chinese-claimed Taiwan to set up a de facto embassy in Vilnius.
China has demanded that Lithuania withdraw its ambassador to Beijing after the Baltic state allowed Chinese-claimed Taiwan to open a de facto embassy there.
In a statement on Tuesday, the Chinese foreign ministry said it would also recall its envoy to Vilnius over the dispute.
China considers democratically ruled Taiwan to be its most sensitive territorial issue and is regularly angered by any moves that suggest the island is a separate country.
Last month, Taiwan said it was setting up a representative office in Vilnius called the Taiwanese Representative Office, marking the first time the island’s name has been used for one of its offices in Europe, as normally only “Taipei” is used.
China, which had already denounced the decision, has now gone a step further with concrete action to express its ire.
Lithuania’s move was done “in disregard of China’s repeated representations and articulation of potential consequences”, and severely undermines China’s sovereignty, the Chinese foreign ministry said.
“The Chinese Government expresses its categorical opposition to this move. China has decided to recall its ambassador to Lithuania and demanded the Lithuanian Government recall its ambassador to China,” it added.
“We urge the Lithuanian side to immediately rectify its wrong decision, take concrete measures to undo the damage, and not to move further down the wrong path.”
Lithuania said earlier this year it plans to open its own representative office in Taiwan, and has donated 20,000 COVID-19 vaccine doses to the island.
Only 15 countries have formal diplomatic ties with Taiwan, but many others have de facto embassies, often termed “trade offices”, as is the case for the European Union, of which Lithuania is a member state.
China has ramped up pressure on countries not to engage with Taiwan.
In February, the South American country of Guyana revoked a deal for Taiwan to open a representative office there only a day after Taipei had announced it. Taiwan blamed Chinese “bullying” for the decision.