Google Android users have also gone down to 500MB, but were previously able to access 3GB of data each month. T-Mobile justified the move by saying it would provide "a better experience for all our customers who use internet on their phone".
"Given that data allowance was a driving force in choosing T-Mobile over competitors last year, this is a huge blow," disgruntled T-Mobile customer Steve Anderson told the BBC.
The move is bound to be controversial, as it followd the recent decision by Three to cancel data caps. Other providers such as iPhone handler 02 introduced limits last year.
Industry experts believe the move is partly because of the prohibitive cost to T-Mobile of users watching video over mobile, and partly to bring the company into line with its partner Orange.