British Prime Minister Theresa May, in a long-awaited Brexit speech, confirmed on Tuesday that her country will leave the single market, media reports said.
During her speech at lancaster House, May said, Britain wants to remain "the best friend and neighbour" to European partner. "We do not seek membership of the single market but the greatest possible access to it," reported BBC.
She announced Parliament would get a vote on the final deal agreed between Britain and the European Union and also promised an end to Britain's "vast contributions" to the EU.
May said it was not her intention to "undermine" the EU or the single market.
But she warned the EU against a "punitive" reaction to Brexit, as it would mean "calamitous self-harm for the countries of Europe and it would not be the act of a friend", said the report.
"It should give British companies the maximum possible freedom to trade with and operate within European markets and let European businesses do the same in Britain. But I want to be clear: What I am proposing cannot mean membership of the single market," she said.
The single market allows the free movement of goods, services and workers between its members.
The government had previously revealed few details about what it wants to secure from the Brexit talks.
The labour Party urged May to push for a "deal that works for trade". EU leaders had said the UK cannot "cherry pick" access to the single market while restricting the free movement of people.
Addressing an audience, including foreign ambassadors in central london, May said Britain had "voted for a brighter future for our country" and would become "stronger, fairer, more united" after Brexit.
She said Britain's history was "profoundly internationalist" and would remain so.
The Prime Minister said that Britain had often been seen as "an awkward member state", but the EU had not demonstrated "enough flexibility on many important matters for a majority of British voters".