The US has been given the go-ahead to impose tariffs on $7.5bn (£6.1bn) of goods it imports from the EU.
It is the latest chapter in a 15-year battle between the US and the EU over illegal subsidies for planemakers Airbus and rival Boeing.
The ruling by the World Trade Organization could mean tariffs on EU goods ranging from aircraft parts to luxury goods and shellfish.
Brussels said the move would be short-sighted and counterproductive.
The US had wanted to impose tariffs on $11bn worth of EU imports in retaliation for illegal aid to Airbus but the figure was reduced by the WTO.
Meanwhile, the two sides are waiting for the WTO to decide the permissible retaliation against the US in the European Commission’s parallel case against Boeing. That ruling is expected next year.
The European Commission said the two sides should try to reach a settlement.
“But if the US decides to impose WTO authorised countermeasures, it will be pushing the EU into a situation where we will have no other option than do the same,” the European Commission said.
Airbus chief executive Guillaume Faury also called for a resolution.
He said it would be a “a barrier against free trade and would have a negative impact on not only the US airlines but also US jobs, suppliers, and air travellers”.
Airbus said that close to 40% of its aircraft-related procurement comes from US aerospace suppliers, which it said it supports 275,000 American jobs in 40 states.