Samsung has urged owners of the Galaxy Note 7 to turn off the smartphone while it investigates new reports of the device catching fire.
The South Korean firm also said it would stop all sales of the phone.
Samsung recalled 2.5 million phones in September after complaints of exploding batteries and later assured customers that all replaced devices were safe.
But there are now reports that even those phones that had been replaced were catching fire.
“Because consumers’ safety remains our top priority, Samsung will ask all carrier and retail partners globally to stop sales and exchanges of the Galaxy Note 7 while the investigation is taking place,” the company said.
“Consumers with either an original Galaxy Note 7 or replacement Galaxy Note 7 device should power down and stop using the device and take advantage of the remedies available,” it added.
South Korean media reports suggest the company is likely to stop selling the phone permanently.
The problems for Samsung come at a crucial time for the firm, technology analyst Andrew Milroy of Frost & Sullivan told the BBC.
“Samsung had been making a comeback against its rivals. This catastrophic product fault will seriously damage its competitive position in the smart phone market,” he said.
Jake Saunders of ABI research said the situation for Samsung was now “very serious” with “the consequences beginning to snowball”.
“The concern now will be the knock-on consequences on the reputation of the brand.”
Consumer tech analyst Caroline Milanesi of Creative Strategies told the BBC that Samsung should “call it a day” on production of the Galaxy Note 7 to limit long-term risk to the brand.
However, South Korea’s finance minister has warned that the country’s exports would be hurt if the phone model is scrapped altogether.
“Right now we can’t tell what the impact will be in the long term. It’s up to the company and the government cannot interfere,” said Yoo Il-ho. “But if they do scrap the model, it will have a negative impact on exports.”
Analysis: Dave Lee, BBC North American technology reporter, San Francisco
What a disaster.
Samsung was dragging its heels in the face of new reports that its Note 7 phones were still burning up. Perhaps even Samsung itself could not quite believe that one of the world leaders in electronics could have made such a catastrophic product safety error… twice.
They say it’s the cover-up that gets you, and it appears that all the proactive work Samsung did to mitigate the Note 7 fiasco has been undone by being slower to acknowledge that the devices are still dangerous.
This story is no longer just about the Note 7. It’s about the trust consumers have in Samsung’s wide range of products – trust that seems to be, excuse me, going up in smoke.
What happens to the phones?
Smartphones have lithium batteries and there is an arms race to make them ever smaller, more efficient and charge faster. In the Samsung case, it is thought that negative and positive electrodes coming together have caused short circuits, overheating, and then causing “explosions” and meltdowns of the phones.
How many people are affected?
Samsung says the recalls affects 2.5 million devices. According to the company, 45,000 Note 7s had been sold across Europe through pre-ordering, mostly in the UK. More than 75% of those have been replaced with either a Note 7 or another Samsung handset.
What does it mean for Samsung’s rivalry with Apple?
The Galaxy Note 7 was meant to be Samsung’s flagship phone, released just weeks before Apple’s iPhone 7. It was well received but since the scandal, Samsung shares have taken a hit and Apple has seen its stock rise. There’s also expected to be significant damage to brand image and reputation.
The US consumer protection agency has also urged people not to use their Samsung replacement devices.
“No one should have to be concerned their phone will endanger them, their family or their property,” Elliot Kaye, chairman of the safety commission, said. He called Samsung’s decision to stop distributing the device “the right move” in light of “ongoing safety concerns”.
The South Korean transport ministry on Tuesday said people should not use or charge their Note 7 devices on a plane.
The original Note 7 had already been banned by numerous aviation authorities and airlines around the world.
On Monday, US mobile networks AT&T and T-Mobile had already stopped replacing or selling the phone. In the UK, Vodafone and EE had suspended replacements.