The centre, Kvinfo - a portmanteau of kvinde, the Danish word for 'woman', and 'information' - describes itself as an information and development centre for gender equality and diversity. It has operated under Denmark's Ministry of Culture since 1987.
The funding cut was the second blow received by the centre this week.
On Monday, Minister for Culture Mette Bock of the Liberal Alliance (LA) party, which forms part of Denmark's coalition government, announced that the centre would be deprived of its mandate to run a gender equality research library, which will now be moved to the Royal Library (Det Kongelige Bibliotek).
Kvinfo has already stated that it consider's the library decision to be against the best interests of gender equality research.
“The Ministry of Culture created Kvinfo with the overarching aim of working towards a more gender equal society… Kvinfo's activities are a key contribution to the debate on gender, equality and diversity, with an academic foundation,” said the centre via a statement on its website Wednesday.
But the organisation was dealt a second round of bad news when integration minister Inger Støjberg confirmed that her ministry would be cutting two million kroner from the centre's funding, currently used to run a mentor network for women of ethnic minorities.
“For me what is important is how we make best use of the money. And I do not think that Kvinfo are best placed to carry out the task with minority women,” Støjberg told broadcaster TV2.
Debate relating to the work of the organisation heated up earlier this week when LA's gender equality spokesperson Laura Lindahl said that her party wanted to drop state support for the “left-wing” Kvinfo, reports news agency Ritzau.
Støjberg told the broadcaster that she also felt that Kvinfo was “in many ways a left-wing organ”.
“I am not sure that Kvinfo is the organisation that has the best grasp of things when we are talking about ghetto areas – and it is after all there, we need to operate,” she said.
The opposition Social Democrats have criticised LA for carrying out an “ideological crusade” against Kvinfo and have summoned both her and Minster for Gender Equality Karen Ellemann to consultation over the issue, reports TV2.