Mexico City has removed a statue of Heydar Aliyev, the late president of Azerbaijan, from a park in the city. It was on the city's main avenue which Azerbaijan paid to have renovated.
Azerbaijan has threatened to cut investments in Mexico in response.
Mexico City officials said the statue would be looked after unless the Azeri Embassy requested its return.
Mr Aliyev led his country to independence from Soviet rule but was accused of stifling opposition. A plaque with the statue describes him as "a great politician and statesman".
The Azerbaijan-Mexico Park was unveiled by Mexico City's previous mayor Marcelo Ebrard last year.
Critics said the statue jarred with other nearby monuments to Mahatma Gandhi, Abraham Lincoln and Mexican national heroes.
Azeri investments in Mexico amount to $US4 billion, according to the Azeri embassy in Mexico.
