WASHINGTON — The Obama administration has deepened its rift with its Gulf allies over the ongoing conflict in Yemen, blocking a transfer of precision munitions to Saudi Arabia because of concerns about civilian casualties that administration officials attribute to poor targeting.

Administration officials said on Tuesday that the White House had made the decision to block the sale by Raytheon of about 16,000 guided munitions kits, which upgrade so-called dumb bombs to smart bombs that can more accurately hit targets. The kits, if purchased over the life of the proposed contract, are valued around $350 million.

But administration officials said that upgrading the bombs would not help targeting if the Saudi-led coalition in Yemen did not choose its targets properly, an ongoing concern since the start of bombing campaign. This year, the United States blocked a sale of cluster munitions to Saudi Arabia because of similar concerns.

The administration’s decision is a setback for Raytheon, which officials say pushed hard for approval of the sale. Administration officials said that Raytheon’s chief executive, Thomas A. Kennedy, personally lobbied Tony Blinken, the deputy secretary of state, and also reached out to Secretary of State John Kerry and Susan Rice, the national security adviser. It was unclear if he connected with Mr. Kerry or Ms. Rice.

Josh Earnest, the White House press secretary, said on Tuesday that the Obama administration has “long expressed some very significant concerns about the high rate of civilian casualties” in the Yemeni conflict. Administration officials pointed to the bombing in October of a funeral hall in Yemen that killed over 100 people and wounded hundreds of others. The Saudi-led military coalition involved in Yemen’s war acknowledged that one of its jets carried out the attack, for which it blamed faulty intelligence.

The funeral bombing prompted the administration review of the United States’ engagement in the conflict. A senior administration official said that until what he called “flaws” in Saudi Arabia’s targeting of Iranian-backed Houthi rebels is addressed, the United States would block the arms sale.

The blocking of the sale is bound to further deteriorate an already shaky relationship between the United States and Saudi Arabia, which has worsened during the Obama administration. Sunni Arabs are alarmed about a stronger Shiite-majority Iran, and object to the Iran nuclear deal signed by the United States and five other countries.

Some Sunni Arab allies have expressed hope that President-elect Donald J. Trump might adopt a more conciliatory tone toward Saudi Arabia, but foreign policy experts caution that no one, at this point, has a firm idea of how Mr. Trump, who has made fighting radical Islamic militant groups a centerpiece of his campaign, will conduct foreign policy in the region.

Yemen’s conflict began in 2014 when the Houthis, from the country’s north, allied with rogue army units and stormed the capital, Sana, pushing the internationally recognized government into exile. Last year, Saudi Arabia formed a military coalition that has been bombing the rebels, seeking to dislodge them from the capital and restore the government.

All of the warring parties have been accused of war crimes, including indiscriminate attacks on civilian areas and the recruitment of child soldiers. The United Nations says more than 10,000 people have been killed, and much of the country is short of food.

Besides halting the munitions sales, first reported by Reuters, the White House is also cutting back on some intelligence sharing with Saudi Arabia, which administration officials acknowledge could potentially lead to even more civilian casualties. To try to prevent that, an administration official said that the United States would refocus training with the Saudi Air Force in how to better choose bombing targets.

But some American support for the Saudi-led campaign will continue, administration officials said. The American military will continue to refuel coalition aircraft. In addition, officials said that the United States would increase intelligence sharing with Saudi Arabia about threats to the Saudi border.

Human rights organizations, which have sharply criticized American support for the Saudi-led bombing in Yemen, said that blocking the arms sale was not enough. “The absence of a more comprehensive ban, given the ongoing unlawful strikes and the potential U.S. complicity, is deeply concerning,” said Sarah Margon, the Washington director at Human Rights Watch.

She added that the organization found it “disappointing that the review has not been made public as doing so would send a clear message to Riyadh that opacity is not acceptable given the scale and scope of the civilian casualties.”