Knopfler, the former frontman of the Dire Straits, called off several shows in Russia scheduled for June after Russian authorities conducted raids on the offices of several human rights organizations including Human Rights Watch and Amnesty International, the BBC reported.
President Vladimir Putin's United Russia Party passed a bill in November that requires all non-government organizations that are politically active and receive foreign funding to register as "foreign agents."
In recent weeks, more than 100 NGO offices have been searched by authorities.
Knopfler said in a statement: "Given the crackdown by Russian authorities ... I have regretfully decided to cancel my upcoming concerts in Moscow and St. Petersburg."
"I hope the current climate will change soon," Knopfler said. "I have always loved playing in Russia and have great affection for the country and the people."
Opponents of Putin have supported Knopfler's decision to cancel his tour dates in Russia.
"I don't just understand Knopfler's decision. I respect it," wrote anti-government blogger Anton Nosik.