West Midlands Metro chiefs said cracks have been discovered on the trams – and repairs would be carried out "as quickly as possible".
It marks the second time the tram fleet has been pulled from service after cracks were found in the under-frame structure back in June.
Temporary repairs were carried out but chiefs have found that more extensive and permanent repairs are now required.
The Express & Star spoke to a tram driver who said they only found out the services would be stopped when it was publicly announced.
The decision has been made to halt all services from November 13 to carry out these repairs which are expected to take at least four weeks – a major blow for commuters, businesses and shoppers in the run up to Christmas.
A spokesman for West Midlands Metro said: "Earlier this year West Midlands Metro discovered cracks on our trams, which resulted in a temporary interruption to services for inspections and repairs.
"Temporary repairs were carried out to return our fleet to service as soon as possible but inspections have found that more extensive and permanent repairs are now required
"We are continuing to work alongside the tram manufacturer to understand the issues and carry out the repairs as quickly as possible. At this time we are unable to confirm when services will resume but we expect it will take at least four weeks.
"We have taken this difficult decision to ensure services can continue to run safely and reliably in the future.
"We apologise sincerely for the inconvenience this will cause and we are working with Transport for West Midlands (TfWM) to ensure measures are in place so that our customers are still able to travel safely and reliably around the region on public transport. Further information can be found on the West Midlands Metro website here and the TfWM website here.
"We will keep customers fully updated via our website and social media channels."
Ian Brookfield, leader of Wolverhampton Council, said: "This is a shock, but it's also a major blow not just for Wolverhampton but also all the towns in-between and also Birmingham too.
"People absolutely rely on the trams to get to work, to go shopping, to get to school. It's devastating.
"People have the right to understand what the hell is going on. We need to know why, what they are going to do about it and how they are going to put it right."
Mayor for the West Midlands Andy Street said: "This is incredibly disappointing and frustrating for customers – but safety must come first. It is now critical that Midland Metro Ltd get the repairs done and restore a safe service ASAP.
"I am seeking urgent answers from them and the manufacturer as to what has gone so wrong."
Councillor Chris Burden, who sits on the Transport Delivery Committee for the West Midlands Combined Authority (WMCA), said: "Frankly, I'm furious about the whole thing. It's beyond disappointing.
"We've in the run up to Christmas and we've got West Bromwich Albion playing, we've got Villa playing, Wolves playing too and trams are absolutely rammed as it is – and winter brings a boost to tourism to the region too. People are getting trams into Birmingham for the Christmas market, or into Wolverhampton and other places to do some Christmas shopping.
"This is the latest [issue] in a long saga – we thought the cracking problem was over and nobody is taking accountability for it. This is someone's fault and the only people we can hold accountable is the [West Midlands] mayor and the WMCA.
"I live in Wolverhampton and my day job is in Birmingham – I use public transport and luckily I can get the train, but what about the people in places like Bilston or in Wednesbury, or West Bromwich?
"They will be shunted on the buses and it's the most vulnerable people who will be affected. It's a proper lifeline for people living in places like Bilston."
This is incredibly disappointing and frustrating for customers – but safety must come first. It is now critical that Midland Metro Ltd get the repairs done and restore a safe service ASAP.— Andy Street (@andy4wm) November 12, 2021
I am seeking urgent answers from them and the manufacturer as to what has gone so wrong. https://t.co/49Pb6qclUK