The pastor, who last year planned a Koran-burning protest in the US, had been invited to address right-wing group England Is Ours in Milton Keynes.
The Home Office said Mr Jones could not enter the UK as the government "opposes extremism in all its forms".
Mr Jones told BBC Radio 5 live he would challenge the "unfair" decision and his visit could have been "beneficial".
Mr Jones - who is pastor of the Dove World Outreach Center in Gainesville, Florida, which has fewer than 50 members - came to prominence last September when he announced plans for his "International Burn a Koran Day" on the anniversary of the 9/11 attacks.
His plan was internationally condemned and sparked many demonstrations around the world before he eventually called off his protest.
'Unacceptable behaviour'
A Home Office spokesman said: "Numerous comments made by Pastor Jones are evidence of his unacceptable behaviour.
"Coming to the UK is a privilege not a right and we are not willing to allow entry to those whose presence is not conducive to the public good.
"The use of exclusion powers is very serious and no decision is taken lightly or as a method of stopping open debate."
Mr Jones said he had not been planning to break any laws while in England.
"The whole object of the exercise is to have a discussion about the
Islamification of the UK and just have dialogue about the problems”
Quote Barry Taylor England Is Ours
Quote Barry Taylor England Is Ours
"I'm not against Muslims, we are not against their religion," he said. "We have, here in the West, freedom of religion and limited freedom of speech which we don't have in their countries.
"What I am against is the radical element. If I came to England we would expect Muslims to rally with us."
He added that the ban was also unfair on a "human basis" because his daughter lived in England and his grandchildren were English.
Mr Jones had accepted an invitation to speak to England Is Ours in February and was due to address a series of demonstrations against the expansion of Islam and the construction of mosques in the UK.
Barry Taylor, secretary of England Is Ours, said he was "very disappointed" by the decision.
"The whole object of the exercise is to have a discussion about the Islamification of the UK and just have dialogue about the problems," he said.
"The idea isn't to cause trouble or kick up a stink. These things do need addressing and people do need to speak about them. We shouldn't be frightened about them."
Sabotage of rights
He said he had expected about 100 people to attend events organised for Mr Jones, including about 30 members of England Is Ours.
"It's quite possible that other members of his outreach may be able to come," Mr Taylor said.
"I understand Pastor Jones is planning some visits to nearby European countries and we will be able to go and visit him there," he added.
A press release issued by Stand Up America - which is organising rallies addressed by Mr Jones - said the UK ban exemplified the sabotage of the basic human rights of freedom of speech and freedom of expression.
In December, Home Secretary Theresa May said she was "actively looking at" whether Mr Jones should be banned from entering the UK after the right-wing English Defence League (EDL) had invited him to share his views on Islam at a rally in Luton in February.
However the EDL later withdrew the invitation to Mr Jones. A spokesman said it was because of his critical views on homosexuality and race.
BBC News
