The EU on Monday condemned Turkey's assault on Kurdish forces in northern Syria but stopped short of imposing the formal arms embargo some countries have urged.
Several European states including Germany and France have already halted arms exports to Turkey and there were calls for an official EU-wide ban.
But senior diplomats told AFP that Turkey's membership of NATO made such an embargo extremely difficult.
Instead, EU member states agreed to the "strict application" of their existing common policy on arms exports, which includes a provision that they should not be approved where they may "contribute to regional instability".
EU diplomatic chief Federica Mogherini said the commitment, agreed by all 28 foreign ministers at talks in Luxembourg, would have the "same effect" as an arms embargo but was quicker and easier to implement.
But after repeated EU calls for Ankara to halt its operation went ignored, she was downbeat about the chances that the latest move would convince Turkish President Recep Tayyip Erdogan to change course.
"I'm glad that on this occasion the European Union and member states were not only able to speak with one voice but also to act in unison and we take a further step. Will that be enough? We'll see," she told reporters.
Luxembourg Foreign Minister Jean Asselborn was even more pessimistic, saying Erdogan was not counting on Europe to supply his forces.
Turkey quickly hit back Monday -- the sixth day of the assault -- accusing Brussels of protecting "terror elements".
"It is unacceptable for the EU to display an approach that protects terror elements," Ankara's foreign ministry said in a statement.
"We totally reject and condemn the decisions and calls made to our country," it added
German Foreign Minister Heiko Maas said EU countries had agreed "that they will no longer authorise arms exports to Turkey".
But when asked whether this would apply to existing contracts to supply Turkey or only to new business, he said "every country will have to clarify this for itself".
Spanish Foreign Minister Josep Borrell, who will soon replace Mogherini at the EU, said Monday's decision would only apply to new contracts, noting arms sales were a matter for member states.
One high-level European diplomat said that because Turkey is a NATO member, the EU was not in a position to impose an official embargo.
- Diplomatic haggling -
Monday's statement said the EU "condemns Turkey's military action, which seriously undermines the stability and the security of the whole region".
But, in a sign of the divisions that regularly bedevil EU attempts to impose itself on the geopolitical stage, even this took three and a half hours of closed-door haggling among the ministers.
Diplomats told AFP that Britain in particular refused to agree to the word "condemn" until a paragraph was added acknowledging Turkey's role as a "key partner".
For some, the EU's inability to influence Turkey -- a neighbour still at least theoretically on the path to membership -- over the offensive highlighted the bloc's fundamental weakness as a geopolitical player.
"What happened is that we are happy that we managed to agree to condemn something. That's the state of EU foreign policy," one EU diplomat lamented.
Mogherini warned that, as well as sparking a humanitarian crisis, the Turkish advance risks creating space for the Islamic State (IS) group to "resurrect" itself following the defeat of its self-declared "caliphate".
France has called for a meeting of the US-led coalition to defeat IS -- of which Turkey is a member -- and Mogherini said the EU was echoing this appeal "in a very formal way" with Washington.
The US has ordered the withdrawal of almost its entire ground force in Syria, leaving the Kurds feeling abandoned by their ally in the fight against IS.
- Headache for NATO -
The Turkish incursion creates huge headaches for NATO, with Luxembourg's Asselborn calling the situation "unbelievable", particularly in light of the deal struck between the Kurds and Syrian President Bashar al-Assad.
"This means that officially... a NATO member is fighting against Assad," he said, asking whether it could lead to NATO being drawn into the conflict because of its mutual self-defence pact.
"Imagine that Turkey is attacked by Syria or allies by Syria."
Turkey's assault, which has seen air strikes, shelling and a ground incursion, has killed scores of civilians and fighters since its launch on Wednesday.
NATO chief Jens Stoltenberg held talks Friday with Erdogan and his foreign minister Mevlut Cavusoglu, sharing his "very serious concerns" about the offensive.
Cavusoglu said Spain had told Ankara it would withdraw its Patriot missile batteries from Turkey -- originally deployed to help defend it against IS -- when the current mission ends in December.