YouTube is blocking all premium music videos to UK users after failing to reach a new licensing agreement with the Performing Right Society (PRS). Thousands of videos will be unavailable to YouTube users from later on Monday.
Patrick Walker, YouTube's director of video partnerships, told BBC News that the move was "regrettable".
Steve Porter, head of the PRS, said he was "outraged... shocked and disappointed" by YouTube's decision.
In a statement, Mr Porter said the move "punishes British consumers and the songwriters whose interests we protect and represent".
The PRS has asked YouTube to reconsider its decision as a "matter of urgency". The body, which represents music publishers, added: "Google has told us they are taking this step because they wish to pay significantly less than at present to the writers of the music on which their service relies, despite the massive increase in YouTube viewing.
"This action has been taken without any consultation with PRS for Music and in the middle of negotiations between the two parties."
Mr Walker told BBC News the PRS was seeking a rise in fees "many, many factors" higher than the previous agreement.
He said: "We feel we are so far apart that we have to remove content while we continue to negotiate with the PRS."
"We are making the message public because it will be noticeable to users on the site." Videos will begin to be blocked from 1800 GMT with the majority of them made inaccessible over the next two days.
YouTube pays a licence to the PRS which covers the streaming of music videos from three of the four major music labels and many independent labels.
While deals with individual record labels cover the use of the visual element and sound recording in a music video, firms that want to stream online also have to have a separate deal with music publishers which covers the music and lyrics.
In the UK, the PRS acts as a collecting society on behalf of member publishers for licensing fees relating to use of music.
YouTube stressed that it continued to have "strong partnerships" with three of the four largest record labels in the world.
Mr Walker said the PRS was asking for a "prohibitive" rise in the cost of a new licence.
While not specifying the rate the PRS was seeking, he said: "It has to be a rate that can drive a business model. We are in the business for the long run and we want to drive the use of online video.
"The rate they are applying would mean we would lose significant amounts of money on every stream of a music video. It is not a reasonable rate to ask."
YouTube has also complained of a lack of transparency by the PRS, saying the organisation would not specify exactly which artists would be covered by any new deal.
"That's like asking a consumer to buy a blank CD without knowing what musicians are on it," a statement from YouTube UK says on its official blog.
YouTube is the world's most popular online video site but has been under increased pressure to generate more revenue since its purchase by Google for $1.65bn in 2006.
"We are not willing to do this [new licensing deal] at any cost," said Mr Walker.
He said the issue was an industry-wide one and not just related to YouTube.
"By setting rates that don't allow new business models to flourish, nobody wins."
Services such as Pandora.com, MySpace UK and Imeem have also had issues securing licence deals in the UK in the past 12 months.