Unlike the Arab group's call in March for a no-fly zone over Libya, which set the stage for the NATO action that helped topple Muammar Gaddafi, Saturday's surprisingly tough measures did not include a request for the use of force.
But they will strengthen Western powers arguing for a tough United Nations resolution criticising Syria's suppression of protests against President Bashar al-Assad, in which the United Nations says 3,500 people have been killed.
They will also further embolden demonstrators who, inspired by uprisings which toppled the leaders of Tunisia, Egypt and Libya, have defied a sustained military crackdown since March and taken to the streets to call for Assad's overthrow.
"We don't want foreign intervention," Qatari Prime Minister Sheikh Hamad bin Jassim said as he announced the Arab League's decision in Cairo. "We are not talking about arming (the opposition), or a no-fly zone. No one at the League is talking about this issue."
But the measures he announced -- including suspension from the League, political and economic sanctions, and an appeal to the army to stop shooting civilians -- marked a dramatic increase in the pressure on Syria by countries traditionally reluctant to intervene in the affairs of fellow Arab states.
Assad already faces U.S. and European sanctions against Syria's oil exports and several state businesses, and has alienated his powerful northern neighbour, Turkey.
The Arab League decision to withdraw Arab ambassadors from Damascus isolates him and makes him ever more reliant on Iran, tightening relations forged by Bashar's father Hafez and strengthened during Bashar's 11-year presidency.
Damascus responded angrily to the Arab League suspension, approved by 18 foreign ministers of the 22-member body, saying such decisions could only be taken by consensus and accusing the organisation of implementing a Western and anti-Syrian agenda.
"For all the Syrian bravado and rhetoric, this is the biggest hit that they have taken. Even more so than the EU and U.S. sanctions," said Rime Allaf, associate fellow at London's Chatham House.
The Qatari premier did not spell out the economic sanctions planned against Syria, which is already expected to suffer a sharp economic downturn this year as tourism revenues dry up, trade falls, manufacturing is disrupted, oil output dips and authorities struggle to find buyers of Syrian crude.
Full-scale trade sanctions would be devastating but might be difficult to implement. But analysts say targeted sanctions may be imposed, possibly on the sale of oil products to Syria.
"A full-on trade embargo would be a dramatic escalation and would be surprising. It would be a very clear statement that they want to remove the regime, not just force concessions from it," said Chris Phillips, a Middle East analyst at the Economist Intelligence Unit (EIU).
"I think it highly unlikely. Even with political will to do that, it would be difficult logistically," he said, adding that neighbouring Turkey and Iraq both rely heavily on Syrian transit trade for their exports and imports.
Adel Soliman, head of the International Centre for Future and Strategic Studies in Cairo, said economic sanctions would not force Assad into any policy change but would bolster international moves against Damascus.
The package of Arab League measures, which included proposals for talks with human rights organisations about ways of protecting Syrian civilians, would "give a chance for all the international community to act," Soliman said.
China and Russia, veto-holding members of the U.N. Security Council, blocked European and U.S. efforts to obtain a resolution which would have condemned Syria's crackdown and could have paved the way for U.N. sanctions.
The EIU's Phillips said Saturday's suspension could go some way towards softening China's opposition to a U.N. resolution, which he said was based partly on Beijing's concern not to be seen to be acting against the wishes of Arab trading partners.
"This sends a clear message to China -- you don't need to stick to Assad to keep (Arab countries) on board," he said. "If China could be swayed, that could put a lot of pressure on Russia over its veto."
Despite the growing international pressure, few expect Assad to end the crackdown whose targets he says are militant groups that Damascus blames for the violence in Syria. Authorities say more than 1,100 members of the security forces have been killed since the uprising erupted.
"If he just continues to defy signals from the Arab world and international community it's increasingly grim for him," said Rami Khouri, director of the Issam Fares Institute in Beirut. "The regime itself shows no sign of seriousness in taking the tough steps needed."
Khouri said that, in the absence of a breakthrough, the Arab League could step up its contacts with the opposition as a prelude to "talking only to the opposition as the sole legitimate representative of the Syrian people".
He said it could also call on Arab organisations to provide "some kind of protection" to Syrian civilians, but dismissed prospects for a Libya-style NATO intervention.
NATO Secretary-General Anders Fogh Rasmussen said on a visit to Libya two weeks ago that NATO had no intention of intervening in Syria, and Khouri and other analysts said Saturday's moves were unlikely to change that position.
Syria's central role in Middle East politics has made Western powers wary of intervening. It has a complex ethnic and sectarian mix, alliances with Tehran and militant groups Hamas and Hezbollah, and remains in a formal state of war with Israel which seized the Golan Heights from Syria in 1967.
"We should be very careful about jumping to conclusions about international intervention," Allaf said. "We are very far from a Libya situation".