However, Chinese experts warned that the US will make sure the deployment is completed, and China should not be satisfied with South Korea's decision.
A senior presidential Blue House official told reporters it would decide on the continued deployment of the system after completing an environmental evaluation, though the installed THAAD components would remain, the Xinhua News Agency reported on Wednesday.
The assessment could take more than a year, Yonhap News Agency reported citing an official from the presidential office, adding that a similar evaluation of the THAAD deployment in Guam took 23 months.
China's foreign ministry on Wednesday reaffirmed its "clear-cut, consistent and resolute" position against the THAAD deployment.
South Korean foreign minister nominee Kang Kyung-wha also said Wednesday that she will consider sending senior officials to China to discuss the installation of the THAAD system, adding that communication between South Korea and China should be maintained through a variety of channels to narrow differences.
The suspension shows that the new administration is striving to achieve political balance with its limited power, Jin Canrong, associate dean of the Department of International Studies at the Renmin University of China, told the Global Times.
"However, it is the US which will decide the THAAD's deployment. Considering that the US remains skeptical towards China and Russia, the deployment will eventually be completed regardless of what South Korean President Moon Jae-in has in mind," Jin said.
Moon is aware that he has very little leeway on the deployment, and ordering a halt to the deployment is a way of appeasing China, Zheng Jiyong, director of the Center for Korean Studies at Fudan University, told the Global Times on Wednesday.
Moon will travel to Washington later this month to meet his counterpart Donald Trump.
Moon also wants to relay to the US its displeasure over the rushed deployment, and to warn against THAAD supporters in South Korea, Zheng said.
Two weeks before South Korea's presidential by-election on May 9, some THAAD components, including its radar and two mobile launchers, were transported in the middle of night to a golf course in Seongju county.
Four more THAAD launchers were delivered to an unidentified US military base in South Korea, but the delivery was not reported to Moon, who took office on May 10.
The Chinese government should not have any illusion of having the system withdrawn, nor should it be optimistic about Moon's decision, which only appeases China for now, Zhao said.
South Korea said THAAD is meant to protect it against North Korea's nuclear threat. But China and Russia strongly oppose the deployment.
This article was written by Li Ruohan and originally published in the Global Times.
