The rise in import duties on Chinese goods from 10% to 25% was due to come into effect on 1 March.
According to President Trump's Twitter, this is because both sides had made "substantial progress" in trade talks, which sent Chinese stocks up nearly 5 percent.
Trump also confirmed a meeting in Florida with Chinese President Xi Jinping that would finalize the deal between the two countries, who had previously been locked in a trade war.
"I am pleased to report that the U.S. has made substantial progress in our trade talks with China on important structural issues including intellectual property protection, technology transfer, agriculture, services, currency, and many other issues," Trump wrote on Twitter.
He continued, "As a result of these very productive talks, I will be delaying the U.S. increase in tariffs now scheduled for March 1. Assuming both sides make additional progress, we will be planning a Summit for President Xi and myself, at Mar-a-Lago, to conclude an agreement. A very good weekend for U.S. & China!"
China's official news agency Xinhua further confirmed "substantial progress" on specific issues between the two nations, such as technology transfer, intellectual property protection and agriculture.
AFP reports that, "Trump initiated the trade war, which ate into company profits and contributed to stock market plunges, because of complaints over unfair Chinese trade practices -- concerns shared by the European Union, Japan and others."