The measure has also frozen hundreds of pending applications for inter-country adoptions.
The measure has also frozen hundreds of pending applications for inter-country adoptions, blindsiding families who have in some cases waited years and spent thousands of dollars to adopt a child from the Horn of Africa nation.
A spokesman for Ethiopia's Ministry of Women, Children and Youth Affairs declined to comment on the suspension, which diplomats said came into effect on April 21 without warning.
"We haven't been explained what the reasons are behind (the ban), and what the intentions are," Spanish ambassador Borja Montesino told AFP.
Ethiopia is a popular destination for families interested in inter-country adoption.
Spanish families took in 1,200 Ethiopian children in 2010 and 2011, which even led to a brief backlog when the embassy had to halt applications for a while, Montesino said.
American families have adopted more than 5,500 Ethiopian children since 2011, according to the United States embassy.
Adopting a child can involve months, if not years, of vetting by adoption agencies, courts, and embassies, along with thousands of dollars in fees and travel costs.
American Jon Oren and his wife are among those who had already been made legal parents of an Ethiopian child who they are now unable to take home.
The couple had been waiting for the required permission to take their new three-year-old son out of the country when the suspension took effect.
"Now that we're legal parents, documented parents, I'm effectively responsible for his wellbeing," Oren told AFP.
"I kind of can't just undo what I feel are my desires and even legal obligations as a father."
About 40 other American parents are in a similar situation, according to a US embassy statement to AFP, and more than 200 families who have only started the process to adopt have had their application put on hold.
In Spain, about 50 families have had their applications frozen, the ambassador said, while a British official said around a dozen families from the United Kingdom have been affected.
Ethiopia's adoption system has faced allegations in the past that children who are not really orphans are being put up for adoption, prompting embassies to impose new regulations to vet prospective adoptees.
Jozef Naudts, deputy head of mission at the Belgian embassy said he had been told by officials that Ethiopia was reviewing its entire adoption system.
Five Belgian families' adoptions have been blocked by the ban, he said.
"We are just hoping that a solution can be found for the families that are in the process and get kind of stuck because of this decision," Naudts said.