Beijing confirmed it would not renew press credentials for Ursula Gauthier, of the French news magazine L'Obs.
It said an article she wrote about the unrest in Xinjiang supported "terrorism and cruel acts" that had killed people.
Ms Gauthier called the claims "absurd" and said Beijing was trying to deter foreign reporters in the country.
If her press card is not renewed, Ms Gauthier cannot apply for a new visa, and will have to leave China by 31 December.
She would be the first foreign journalist to be expelled since al-Jazeera correspondent Melissa Chan in 2012.
China blames the long-running unrest in western autonomous Xinjiang region on Islamist separatists, many of whom it says have foreign ties.
But Xinjiang's ethnic Uighurs, most of whom are Muslim, say Beijing's repression of their religious and cultural customs is provoking the violence.
Ms Gauthier published her article after the attacks in Paris in November, suggesting China's solidarity with France might have an ulterior motive - to justify its own crackdowns in Xinjiang.
The article triggered condemnation from the Chinese government and state media, which demanded an apology and retraction from her.
China's foreign ministry confirmed on Saturday it would not renew Ms Gauthier's press card, saying she had failed to make a "serious apology" to the Chinese people and was no longer "suitable" to continue working in the country.
"China will never support the freedom to champion terrorism," it said.
The foreign ministry complained of what bit termed a double standard, whereby tough action in the West was called anti-terrorism but in China was described as the repression of ethnic minorities.
Ms Gauthier told the BBC that the authorities had repeatedly called for her to apologise for supporting terrorism.
"I said I never supported terrorism - how do you want me to apologise for something I have not written?" she said.
"I am convinced that they are very clearly trying to intimidate foreign press in China because they don't want anyone to say things which are different from the official version of the question."