"The Security council unequivocally demands that Eritrea immediately
reverse its decision without preconditions," said a Secutiry Council statement.
"The Security Council will be consulting on how to respond to this completely unacceptable action by Eritrea," it said.
The UN Secretary General Kofi Annan has also condemned Eritrea's decision.
"The secretary general condemns yesterday's decision by the goverment of Eritrea to request that members of the United Nations Mission in Ethiopia and Eritrea (UNMEE) who are nationals of certain specified member states should leave the country within 10 days of the notice," a UN statement said.
The move comes amid heightened tensions between with Ethiopia as fears grow of a new war over the disputed border.
In a letter to the UN Mission in Ethiopia and Eritrea (UNMEE) dated Tuesday, peacekeeping staff from those nations were given 10 days to leave the country.
"Members of UNMEE with nationalities from USA, Canada and Europe, including the Russian Federation are requested to the leave the country within 10 days of this notice," it said.
The letter was addressed to Joel Adechi, a senior UN official in Asmara, and signed by Colonel Zecarias Ogbagaber, Eritrea's top liaison with the UN mission.
Eritrea and Ethiopia went to war in 1998, and a peace deal was reached in 2000.
However Ethiopian forces remain in the town of Badme, even though it was awarded to Eritrea.
UNMEE has 3,794 peacekeepers and support staff on both sides of the 1,000km border, many of whom are based in Eritrea.
The expulsion order will not affect the vast majority of troops, who are mainly from India, Jordan and Kenya, but will hit about 70 of UNMEE's 190 civilian staff and about 90 of 208 military observers, diplomats said.