PayPal has frozen WikiLeaks' account in the latest action against the whistleblower website, which has been posting leaked US embassy cables online.

The decision by the online payment site – which WikiLeaks had used to raise funds for web hosting and other costs – has been announced with a posting on PayPal's blog.

PayPal, owned by the auction website eBay, said the account had been frozen because it was being used for "illegal" activity.

This week Amazon withdrew its cloud hosting of WikiLeaks' cables site and the WikiLeaks.org domain was taken offline. It has since moved to other domains based outside America.

PayPal said: "PayPal has permanently restricted the account used by WikiLeaks due to a violation of the PayPal acceptable use policy, which states that our payment service cannot be used for any activities that encourage, promote, facilitate or instruct others to engage in illegal activity. We've notified the account holder of this action."