The US President used the occasion of his maiden summit with Nato leaders on Thursday to remind the alliance that "23 of the 28 member nations are still not paying what they should be paying and what they are supposed to be paying," and that they owe "massive amounts".
Nato says a rising number of EU members have increased defence spending "significantly" in the last 12 months although only a handful, including the UK and Canada, still only meet the two per cent spending target agreed at a summit in Wales in 2014.
Trump's comments will disappoint alliance leaders who had hoped for a public commitment from the US President to Nato's security guarantees, which he called into question during his presidential campaign last year.
It was notable that Trump refused to publicly reiterate US commitment to Nato's mutual defence provision, article 5, which had been invoked just once before, after 9/11.
However, speaking at a news conference after the summit, Nato Secretary General Jens Stoltenberg said Nato leaders had agreed to step up the alliance's role in the fight against terrorism and fairer burden sharing.
On defence spending and Trump's repeated demand for European allies to pay their fair share, he said, "Trump was blunt on that message today. But we have seen and heard this kind of plain speaking from him before.
"He said two per cent is, for him, a minimum and some allies are already spending more than two per cent.
"He delivered a plain and clear message when it comes to fair burden sharing in the alliance. But we are all aware of the importance of this and we are now moving in the right direction. It is not surprising that he is blunt on this issue but Trump also realises what we are doing and the progress being made.
He is aware that after years of decline defence spending is increasing. We still have a long way to go and much remains to be done but we turned the corner and stopped defence cuts."
The Secretary General told reporters, "In 2015, defence cuts came to a stop. And in 2016, total spending across Europe and Canada increased by billions of dollars. This is not just about cash, but also modern capabilities."
Stoltenberg was repeatedly asked to explain why he thought Trump had not publicly committed to article 5 during the meeting.
On this, he said, "Trump inaugurated a 9/11 article 5 memorial today, which is the strongest expression of US support for Nato. Just by doing he sent a strong signal.
"Trump strongly stated his commitment to Nato and our collective security and defence so we've had a clear message from him that the US is committed to the alliance. It is not possible to be committed to Nato and not to article 5. Trump has been clear on this and about our shared values as he was when we met in Washington recently."
He also hailed Trump's plan to expand, with $4.8bn, the European Reassurance Initiative, a military fund to counter Russian aggression.
The summit, he said, had taken steps "to keep up the momentum" (on defence spending) and to "continue to match words with action."
It had, he said, also been agreed to adopt an action plan designed to enhance Nato's contributions while alliance leaders also decided to increase support to the US-led Global Coalition to Defeat ISIS.
This, he said, will include more AWACS flight-time, more information sharing and increasing air-to-air refuelling.
Stoltenberg said, "This will send a strong political message of Nato's commitment to the fight against terrorism and improve coordination within the coalition."
However, he stressed, "It does not mean that Nato will engage in combat operations."
The fight against terrorism, one of the main issues discussed, requires a "wide range of instruments" but the action plan showed Nato was ready to "step up its efforts."
Stoltenberg welcomed the decision by some Nato members to provide more troop contributions, adding, "It was also agreed that we will share more information and intel and there will be more flying hours and more air to air re-fuelling."
He said Nato would also become a full member of the anti-IS coalition.
"We are doing a lot in fight against terrorism and will appoint a special coordinator to ensure that this action plan is implemented swiftly and effectively."
On Russia, the former Norwegian Prime Minister said, "Our relationship with Russia was also discussed and we stressed the importance of meaningful dialogue.
"The aim is not to provoke, but prevent a conflict and we are open to dialogue with Russia in an effort to reduce risk and improve transparency."
Trump's visit to Brussels was overshadowed by the terrorist attacks in Manchester, with British Prime Minister Theresa May said to be furious at US intelligence officials over leaking of operational intelligence from the police investigation into the suicide bomb attack on Monday
The name of the attacker and photographs reported to be images of the crime scene taken by British investigators were published Wednesday.
Trump, speaking at a ceremony to mark Nato's new $1bn headquarters, called the Manchester leaks "deeply troubling."
Trump has previously supported Britain's shock Brexit vote, claimed the EU was a doomed would-be super state and dubbed Nato "obsolete."
Even so, hopes had been relatively high that the visit, Trump's first overseas trip as US President, could help heal EU/US relations and ongoing rows about European defence spending.
But the severe ticking off he gave alliance members risks souring relations even more. In a sign of growing frustration felt by EU leaders, European Parliament President Antonio Tajani, speaking after meeting Trump in Brussels, defended European defence spending, insisting, "Europe is taking on greater responsibility on defence."
Belgian Greens MEP Philippe Lamberts commented, "Trump's demands on the Nato countries for military rearmament is no answer to the threats and instability we face."
UK Conservative foreign affairs spokesperson Charles Tannock said, "Hopefully both sides took the chance to set aside the rhetoric, sound each other out and lay the foundations of a strong political and security relationship. It is much easier to reach an understanding when you are in the same room, not hailing each other across the Atlantic."