Global Brand Group (GBG), the firm that manages branding for football's governing body, said in a statement the Shanghai-based factory would have to make changes before it was allowed to resume production of the Zakumi figurine.
Zakumi, a green-haired leopard, is the official mascot for the World Cup in South Africa, which starts on June 11.
Britain's News of the World reported in January that the company paid its workers "pitiful" wages and forced them to work in squalid conditions.
GBG said an audit and inspection of the factory had found a number of ways in wich it did not meet the code of conduct for FIFA contractors.
"A corrective action plan has been put together with the manufacturer to close the gaps and make the necessary improvements," it said.
"In the interim, the approval for this factory to manufacture these figurines has been temporarily suspended affording them the opportunity to put in place corrective actions and measures to ensure the factory remedies its non-compliance."
South African trade unions last month threatened to disrupt the tournament because of the allegations. Labour organisations were already angry that some World Cup merchandise is being manufactured outside South Africa, which has an unemployment rate of more than 25 percent
