The city's state department for civil and regulatory affairs said Wednesday it was banning the service with immediate effect and any violations would result in a penalty of €25,000, or $33,000, per passenger. Uber spokesman Fabien Nestmann told Bloomberg that the the company would challenge the ban.
"The service is continuing," said Nestmann. "We're disappointed and think this prohibition order is the wrong approach."
The ban follows a trend across the world, where cities are restricting Uber's services because of safety concerns and lack of licensing. Acquiring a license to drive a taxi in cities like London, Madrid, Paris and Berlin, can cost €200,000 a piece.
The ban follows a protest launched earlier this summer by taxi drivers in London, Madrid, Berlin and other European cities to protest Uber and other taxi startups.
Officials in Hamburg asked Uber to stop operating its service because it was illegal to transport people without a license. Uber was later allowed to resume operations, after the city's administrative court asked for more time to look into the case.
Uber currently operates in Berlin, Hamburg, Frankfurt, Munich and Dusseldorf and has plans to expand to Cologne and Stuttgart, according to Nestmann.