UberPop, which allows non-professional drivers with their own cars to take on passengers at budget rates, via a mobile app, started in Spain in April.
"We've temporarily suspended UberPop in Spain while we appeal the ruling and study new options to allow Spanish people access to safe and comfortable journeys," Carlos Lloret, the head of Uber in Spain, wrote in a blog post late Tuesday.
Uber was working with Spanish politicians to develop new regulations, he added, underlining that the company "respects the law".
The American company had vowed to keep operating after a Spanish judge ordered the service suspended on December 9 in a lawsuit brought by taxi drivers.
Founded in 2009 in California, Uber has grown fast, luring passengers away from regular taxis.
But it has also been targeted by a growing number of legal cases, in the United States and several other countries.
France will outlaw the UberPop service from January 1, and it has also been banned in the Netherlands.