0454 GMT January 21, 2019
Suu Kyi was unable to receive the Gwangju Prize for Human Rights at the time because she was under house arrest by the military junta, AFP reported.
Her party has since taken office in Myanmar and the Nobel Peace Prize winner holds the title of state counselor, but the one-time champion of democracy has been widely accused of apathy or complicity in the plight of the Rohingya.
The United Nations has warned the Muslim minority continue to be targeted in an "ongoing genocide."
"Her indifference to the atrocities against the Rohingya runs against the values the award stands for – protecting and promoting human rights," spokesman Cho Jin-tae of the May 18 Memorial Foundation told AFP.
As a result the foundation's board decided to withdraw her award, he added.
The foundation was set up in 1994 to commemorate the 1980 pro-democracy uprising in Gwangju, which ended in a bloodbath by martial law troops that left more than 200 people killed or wounded.
But the insurrection against then military dictator Chun Doo-hwan inspired the country's pro-democracy protests which culminated in a restoration of democracy seven years later.
Last month, Amnesty International withdrew its prestigious Ambassador of Conscience Award from Suu Kyi, citing her "apparent indifference" to the atrocities committed against the Rohingya.
More than 700,000 Rohingya fled violence in the country last year, mostly to neighboring Bangladesh.
A UN rights team found evidence of widespread murder, rape, torture and arson and called for top generals to be prosecuted for genocide, war crimes and crimes against humanity.