Qatar has recalled its ambassador to Egypt, state news agency QNA said late on Wednesday, following a dispute over Egyptian air strikes on Islamic State targets in Libya.
The diplomatic row came just three months after a thaw in relations between the two countries.
Egyptian jets bombed sites in Libya on Monday hours after Islamic State militants there released a video showing the beheading of 21 Egyptian Christians, drawing Cairo directly into the conflict across its border.
Qatar expressed reservations over the attack at a subsequent meeting of the Arab League, drawing the ire of Cairo.
"According to our reading in Egypt to this Qatari reservation, it became clear that Qatar has revealed its position that supports terrorism." the Egyptian envoy to the League, Tareq Adel said, according to Egyptian news agency MENA.
QNA quoted an official foreign ministry source as saying: "Qatar recalled its ambassador in Cairo for consultations over a statement by the Egyptian envoy to the Arab League."
The row could revive a rift within the Western-allied and oil-rich Gulf Cooperation Council, which peaked when Saudi Arabia, the United Arab Emirates and Bahrain withdrew their ambassadors from Doha last year over its support for Islamists.
Egypt, the Arab world's most populous country, accuses Qatar of supporting the Muslim Brotherhood, which was ousted from power in 2013 when the army moved against President Mohamed Mursi following mass protests against his one-year rule.
Qatari foreign ministry official Saad bin Ali al-Muhannadi said his country had expressed reservations at the Arab League over "unilateral military action in another member (state) in a way that could harm innocent civilians".
He also said Qatar had also expressed reservations over a request by Libya and Egypt to the United Nations Security Council to lift an arms embargo on Libya because it gave leverage to one party over the other before peace talks were concluded and a coalition government was formed.
Despite Qatar's concerns, the Arab League put out a statement on Wednesday expressing its "complete understanding" over Egypt's air strikes and threw its weight behind Cairo's call for a lifting of the arms embargo on the Libyan army.
Egypt in November heeded an appeal by Saudi Arabia to back an agreement among Gulf Arab states that ended the eight-month spat over Qatar's support for the Muslim Brotherhood, which had been designated by several Arab countries as a terrorist organisation, and the promotion of Arab Spring revolts.
Qatari Foreign Minister Khaled al-Attiya, in an interview with the pan-Arab al-Hayat newspaper published on Thursday, said Doha did not support the Muslim Brotherhood, adding that the rift that had divided Gulf Arab nations was history.
Attiya said that there were "differences of opinion, which is healthy, and not disputes" between Gulf Arab countries.