The process was meant to be accelerated after the EU and Turkey agreed in March on a deal to tackle the migrant crisis.
President Recep Tayyip Erdogan however hit back at the "shameless" European Union and challenged it in return to make a final choice on Turkey's long-stalled application for a place in the bloc.
"Turkey has apparently chosen to move away from Europe," EU enlargement commissioner Johannes Hahn said as he unveiled an annual report on EU candidate countries.
"The ball is clearly in Turkey's court now. Turkey's leadership must tell us what they want."
Hahn told European lawmakers the 28-nation union had "serious concerns" about the crackdown launched by Erdogan in the wake of the deadly attempt by part of the military to oust his government in July.
"Turkey as a candidate country must fulfil the highest standards to which it committed itself and on which there cannot be any compromise. In this year's report we therefore stress Turkey's backsliding in the area of rule of law and fundamental rights," Hahn said.
Ankara's moves to reinstate the death penalty were also "incompatible with Turkey's official desire to become a member of the European Union", he said.
The EU report however hailed Turkey's efforts to cut the number of migrants crossing to the Greek islands and its efforts to meet the criteria needed to begin visa-free travel to the bloc for Turkish nationals.
Turkey has been seeking to join the EU since the 1960s with formal accession talks opening in 2005.
The process was meant to be accelerated after the EU and Turkey agreed in March on a deal to tackle the migrant crisis. But the process has been close to collapse since the crackdown in response to the coup.
Tensions have flared further in recent days, with Turkey slamming fresh EU criticism of its crackdown and European Commission chief Jean-Claude Juncker warning that Turkey is moving away from the EU "each day"
Speaking an hour before the release of Wednesday's EU report, Erdogan said: "They shamelessly say that Turkey?s EU negotiations should be reviewed. You are late. Review it as soon as possible.
"But do not just review, make your final decision."
Following the release of the report Erdogan's spokesman Ibrahim Kalin warned against halting the accession process.
"If the European Union takes the decision to cut off negotiations, then they will also suffer the consequences," he told Haber TV.