Chancellor Werner Faymann called the move a "wake-up call for the EU", which he said had failed to protect the bloc's external borders and therefore forced individual members to take matters into their own hands.
Non-EU member Macedonia meanwhile said it had temporarily closed its border with Greece to migrants, blocking the path of hundreds trying to reach northern Europe.
The announcements reflect an ever-deepening rift countries opting to tackle the continent's worst migrant crisis since 1945 on a national level and those calling for a joint European solution.
Sweden, Denmark, Germany and Austria imposed entry restrictions for migrants earlier this month to reduce the influx.
Serbia and Croatia followed suit on Wednesday, saying they would only allow migrants to pass through the country if they were specifically seeking asylum in Austria or Germany.
Human rights groups have expressed fears that the restrictions' knock-on effect risked leaving migrants -- including many children -- stranded in icy temperatures on the western Balkans route.
Separately, German and Turkish police on Wednesday announced major coordinated raids against a criminal trafficking network that used unseaworthy ships to send more than 1,700 refugees to Europe.
The joint operation was a major strike against international organised crime fuelling the record migrant wave to Europe, police chiefs from both countries told a press conference at Potsdam outside Berlin.
'Running out of time'
Governments are worried that the onset of spring, and with it warmer temperatures, will herald a fresh spike in arrivals in the coming months.
"We are running out of time. We need a sharp reduction in the coming six to eight weeks," warned Dutch Prime Minister Mark Rutte, whose country holds the bloc's rotating presidency.
In 2015, more than one million refugees and migrants made the perilous journey by sea to Europe, according to the United Nations. Half of the new arrivals were Syrians fleeing civil war. Many also came from Iraq and Afghanistan.
But the crisis shows no signs of abating, with latest figures revealing that Greece has already seen 21 times more migrants arrive on its shores so far this month than in all of January 2015.
Grasping for solutions, the European Commission is set to unveil a major overhaul of its refugee system, known as the "Dublin Regulation", in March.
Current rules require a migrant's claim to be processed in the EU country they first arrive in.
But the EU's executive body intends to replace the regulation with a permanent quota system, which would require each bloc member to accept a set number of refugees based on its population size and other factors.
Several countries, including Hungary and Poland, remain fervently opposed to such a quota system.
Limits 'morally necessary'
Austria, which last year received one of the highest asylum claims per capita in the bloc, said Wednesday it could not cope with another huge influx.
It said it had decided to accept only 37,500 asylum claims in 2016 -- less than half of the 90,000 applications received last year.
"We can't take in all asylum-seekers in Austria," warned Faymann whose small nation of 8.1 million people has become a key transit country for migrants.
The sentiment was echoed by German President Joachim Gauck who said it was "morally and politically necessary" to limit Europe's refugee influx, and avoid ceding ground to populists and extremists.
German Chancellor Angela Merkel has been facing increasingly strong criticism even from within her own camp over her open-door policy.
Spurred on by Austria's announcement, the Bavarian sister party of Merkel's Christian Democrats (CDU) on Wednesday reiterated its calls for a cap on migrant numbers.
"The Austrians did it. So we have to do it too," said the party's secretary general Andreas Scheuer.
Leading children's charities this week warned that young refugees crossing through the Balkans were at serious risk from the bitterly cold weather and lack adequate shelter from the snowy conditions.
A five-year-old girl and a woman died of cold on Wednesday as they tried to reach Greece by sea, as the flow of migrants heading for Europe resumed following a lull due to high winds.