Austria says it is withdrawing its 377 UN peacekeepers from the Golan Heights after Syrian rebels briefly overran a border position before government troops retook it.
Chancellor Werner Fayman and Foreign Minister Michael Spindelegger said that "the development ... has shown that further waiting can no longer be justified".
Rebels attacked the border position near the destroyed city of Kuneitra early on Thursday. The peacekeepers receive most of their supplies through that position from Israel.
Austria's soldiers make up the largest contingent of the approximately 900 UN peacekeepers posted to the Golan Heights separating Syria and Israel. There has been an Austrian UN peacekeeping force present there since the start of the Golan mission in 1974 to separate Israeli and Syrian forces.
The two Middle East adversaries agreed to creation of the UN Disengagement Observer Force after Syria launched military action in 1973, in a failed effort to retake the area it lost to Israel in 1967.
The Philippines and India also have peacekeepers posted to the Golan. Croatia withdrew its contingent in March. The Philippine military said one of the country's peacekeepers was wounded earlier today during fighting between Syrian government and rebel forces. The soldier suffered a leg injury from an artillery or mortar shell that landed at Camp Ziouni, a logistics base for the UN force. He was in stable condition.
The development is likely to deepen Israel's concerns that the volatile area in the north along the Israel-Syria frontier could fall into the hands of radical Islamic factions fighting with other insurgent groups against President Assad's forces.
The Israeli military said the Israeli side of the crossing had been declared a "closed military zone" and was off limits to journalists because of the fighting nearby.
The incident comes a day after the Syrian military, backed by Lebanese Hezbollah militants, captured the strategic town of Qusair near the border with Lebanon in a significant blow to the opposition fighters trying to topple Mr Assad's regime.
The fighting is increasingly spilling over Syria's borders into neighbouring countries, including into Lebanon where factions that support opposing sides in Syrian civil war have frequently clashed in the past year. Islamic groups such as the al-Qaida-linked Jabhat al-Nusra have become the most organized and most effective force on the opposition side.