Britons have been advised against all but essential travel to Bahrain where violent protests have taken place.
The Foreign Office urged UK nationals already in Bahrain to maintain high security awareness and to avoid large gatherings, crowds and demonstrations.
Non-essential travel to certain areas of Libya has also been advised against after political protests there.
The UK has revoked several arms export licences to Bahrain following concern over the suppression of demonstrations.
The Foreign Office said: "In light of recent developments, the Foreign and Commonwealth Office [FCO] has changed its travel advice to advise against all but essential travel to the Kingdom of Bahrain.
"We have also advised all UK nationals currently in Bahrain to maintain a high level of security awareness particularly in public places and on major highways; and to avoid large gatherings, crowds and demonstrations."
It said the risk of further demonstrations and sporadic outbreaks of violence in Bahrain remained high.
It added: "We have taken this decision in response to reports of live fire in the capital Manama.
"The United Kingdom is alarmed by reports of soldiers firing on protesters in Bahrain. This is an extremely worrying development."
For Libya, the Foreign Office is advising against all but essential travel to the cities of Benghazi, Ajdabiya, Al-Bayda, Al-Marj, Derna, Ajdabiya and Tobruk in eastern Libya, and areas of the country bordering Sudan, Chad, Niger and Algeria.
'Freedom of expression'
According to activists, Bahraini security forces opened fire on anti-government protesters, witnesses and opposition supporters on Friday.
The protesters were fired on after they had gathered in Manama following the funerals of demonstrators killed in a security crackdown.
Foreign Secretary William Hague said he was "alarmed" by the latest reports but welcomed news that King Hamad had promised a national dialogue "with all parties".
Mr Hague said: "The right to freedom of expression and freedom of assembly must be respected. The Bahraini government should move quickly to carry out its commitments to a transparent investigation into recent events and any alleged human rights abuses."
He added: "Bahrain should take further steps on reforms that meet legitimate aspirations for greater social and political freedoms."
Earlier, Labour leader Ed Miliband described the thousands of people protesting against the rulers of Bahrain as "enormously courageous and brave" and backed the UK government's review of arms sales to the country.
Some 24 individual arms export licences and 20 open licences for Bahrain have been revoked and eight individual licences for Libya.
Individual licences authorise a single arms sale while open licences cover multiple sales.
The decision followed a review by the Department of Business, Innovation and Skills, the licensing authority.
In recent months, licences have been approved for tear gas cartridges and equipment used for riot control.
The Foreign Office said there was no evidence that equipment from the UK had been used against protesters.
Foreign Office minister Alistair Burt said a review of export licences to the wider region, including Yemen, was ongoing.
He said: "The longstanding British position is clear - we will not issue licences where we judge there is a clear risk that the proposed export might provoke or prolong regional or internal conflicts, or which might be used to facilitate internal repression."
Welcoming the suspension of licences, shadow foreign secretary Douglas Alexander said: "The government must make clear to the government of Bahrain that Britain clearly condemns the violence that has occurred and urges restraint to be exercised and reforms brought forward."