South Korea's victorious under-18 team were stripped of the Panda Cup on Thursday after they infuriated hosts China with their celebrations.
The Koreans had already apologised to "all the people in China" after a picture emerged of a player with his foot on the trophy.
The Koreans were accused of disrespect after they defeated the home side 3-0 on Wednesday to win the annual youth international competition in the city of Chengdu.
The photograph caused uproar in Chinese media and on social media, with the organising committee accusing the Koreans of "a serious insult".
South Korea's squad and coaches subsequently made a public apology in which all the players and staff bowed deeply.
But with Chinese media fanning the flames, and claims that Korean players also pretended to urinate against the cup, the Chengdu Football Association made clear that apologies were not enough.
"The Panda Cup organising committee decided to take back the trophy won by the Korean team this time," it said in a statement on the Twitter-like Weibo.
The association, which called the players' behaviour "indecent", suggested that South Korea would not be invited back in future.
"Teams and players who violate sports ethics and spirit are not welcome to participate," it warned.
South Korea, who have a simmering sports rivalry with China, also defeated New Zealand and Thailand to win the Panda Cup mini-tournament, which is in its sixth edition.
But the tournament winners have been scrambling to limit the fall-out since the image emerged of the player with his foot on the cup.
A team official, reading a statement in English late on Wednesday in a hastily arranged display of public contrition, called it "a huge mistake".
"We are really sorry for the mistake again and we humbly apologise to all the fans, all the players and also all the people in China," he said.
"(We) apologise again," he added, bowing.
The Chengdu FA's video of the apology has been viewed more than 10 million times on Weibo, where the story was trending, underlining the huge public interest.
The Chinese FA lodged a complaint with the Asian Football Confederation, while Chinese media documented other perceived injustices at the hands of South Korean teams.
They highlighted last year's Pyeongchang Winter Olympics, when China were disqualified in the short-track speed skating women's 3,000m relay, a race won by South Korea.
A South Korean footballer was also in hot water at the London 2012 Olympics, when he held up a banner about a disputed island chain after his team beat Japan to win the men's bronze medal.