The European Court of Justice imposed the penalty after a weeklong war of words in which Poland told the EU to stay out of its judicial affairs while EU members insisted that Warsaw should not have disregarded the bloc's principles.
The EU's top court has ordered Poland to pay one million euros a day for not suspending a controversial "disciplinary chamber" at the heart of a bitter feud between Warsaw and Brussels.
The European Commission requested the fine last month after the Polish authorities did not comply with an earlier ruling from July ordering to immediately suspend the activities of the chamber.
Poland's Prime Minister Mateusz Morawiecki has yet to deliver on a promise to close down the chamber that is seen by critics as a way to keep judges in line with government policy.
The latest move risks deepening a bitter standoff over judicial independence and the primacy of EU law which some fear has put Poland's membership in the bloc in question.
Poland's Constitutional Court earlier this month ruled that parts of EU law were incompatible with the Polish constitution in a ruling denounced by Brussels.
The dispute soured a summit of EU leaders in Brussels last week at which Morawiecki said Poland was "ready for dialogue" but would not "act under the pressure of blackmail".
Several EU leaders at the summit said Brussels should not release $42 billion in pandemic recovery money that Poland badly wants while the issue is unresolved.
Warsaw and Brussels have been at loggerheads for years over the judicial reforms pushed through by the Law and Justice (PiS) government.
Brussels believes the reforms hamper democratic freedom but Poland says they are needed to root out corruption among judges.