He will not be permitted to attend non-public workshops.
The moves came after he had repeatedly shared confidential material with media.
Dunedin City Council chief executive Sandy Graham sent an email to Cr Ong this afternoon outlining steps the council would take to manage the situation.
"I am doing so as a necessary step to prevent further unauthorised release of such information," she said.
Cr Ong then forwarded the email on to media.
Ms Graham had earlier in the day requested an urgent meeting with Cr Ong.
"I want to discuss with you whether you are prepared to comply with requests to maintain confidentiality when you are clearly asked to," she said.
Cr Ong also forwarded this email to media.
He told media the restriction about confidential information was no big surprise.
He saw it as a continuation of "false attacks" against him.
In her email to Cr Ong this afternoon, Ms Graham said he would be free to attend all council meetings as usual.
However, the way he received some information would change.
"For public-excluded and confidential agenda items for a council meeting, I will make the agenda and any supporting papers available to you to read in hard copy, and subject to the requirement you do not take a copy away, nor take photos of them.
"Your reading of such confidential papers will be supervised to ensure these requirements are followed. I need to take this step to manage the real and consistent risk of such information being released by you without authorisation.
"Staff will work with you to arrange a suitable time and location once each council agenda has been published."
Ms Graham said she would review the arrangements "should you agree and demonstrate to me a willingness to no longer release confidential information without authority".
Cr Ong is facing a code of conduct complaint in relation to releasing confidential information.
This resulted from sharing content relating to the possibility of a hotel being built next to Forsyth Barr Stadium in Dunedin.
He then disclosed more information about the project to the Otago Daily Times.
He also leaked a draft preliminary assessment about his conduct by investigator Steph Dyhrberg.
His actions could be a serious breach of the standard of behaviour expected of elected representatives, she said.
