The announcement was expected on Monday.
He added that "the current US administration's policies starting with the transfer of its embassy to Jerusalem last May unveiled its complete prejudice to the Israeli agenda".
In remarks to Israel's Channel 10 News, Palestinian officials lashed out at Trump, and threatened that his policies would mean more bloodshed for Israel.
A provision in a US law says the PLO mission must close if the Palestinians try to get the International Criminal Court to prosecute Israelis for crimes against Palestinians.
The United States has accused Palestinian leaders of rejecting outright a still unseen U.S. peace plan, while in turn the Trump administration is viewed by the Palestinians as being biased in favour of Israel.
In recent weeks Trump has slashed more than $500 million in aid for Palestinians to push them to the negotiating table in pursuit of a Middle East peace plan that he calls the "ultimate deal". "This action should not be exploited by those who seek to act as spoilers to distract from the imperative of reaching a peace agreement".
The White House reportedly mulled the shutting down of the PLO mission in Washington since last November, unless the Palestinian leadership enters serious peace talks with Israel.
Israel on Tuesday welcomed the US administration's recent decision to close the Palestine Liberation Organization (PLO)'s office in Washington.
In a defiant speech against the ICC, National Security Adviser John R. Bolton said the USA will sever ties the court if it goes along with the investigation request, as well as slam it with sanctions against both judges and funds.
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"This is yet another affirmation of the Trump administration's policy to collectively punish the Palestinian people", Palestinian official Saeb Erekat said.
The Palestine Liberation Organization quickly denounced the decision, calling it "the use of cheap blackmail as a political tool".
Israeli Prime Minister Benjamin Netanyahu praised the USA decision to close the PLO mission in Washington, DC on Tuesday evening.
President Donald Trump is closing the Palestine Liberation Organization's mission in Washington, the latest USA blow against the Palestinians and an global court during the stalled Mideast peace process.
The latest USA procedures including halting financial aid to United Nations Relief and Works Agency for Palestine Refugees in the Near East, UNRWA, as well as cutting aid offered to the Palestinian all comes as a humiliation to the Palestinian will, he added.
He has cited the Trump administration's decision to recognize Jerusalem as Israel's capital and cuts in aid to the Palestinians and the United Nations agency for Palestinian refugees.
The Trump administration's latest measures against the Palestinians and their leadership are an attack on prospects for Israeli-Palestinian peace.
"Mogherini in reiterating our call to the Israeli government not to go ahead with its plan to demolish the village - including its school - and displace its residents", the countries said in a joint statement. Led by Jared Kushner, Trump's son-in-law and a senior aide, White House officials have been preparing a peace proposal they intend to put forward at an unspecified time.
Internationally-brokered peace talks between Israel and the Palestinians have stalled since 2014 and Israeli settlements in the occupied territories have steadily expanded. The Trump administration's true objective appears to be portraying the Palestinians as rejectionists for their refusal to submit to American bullying.