But controls available to keep ads from appearing alongside extremist content or partisan-driven hoaxes and lies are relatively weak and put the onus on the advertisers - essentially requiring advertisers to manually block sites they don't want to appear on.
A government spokeswoman said it had placed a temporary restriction on YouTube advertising pending assurance.
According to a report in The Times, Google is to be summoned before the government to explain why ads have been running alongside inappropriate video content - including terrorist propaganda, banned hate preachers and rape apologists.
"Guardian CEO David Pemsel said in a letter to Google that many brands feel they have to place their ads on the company's services because of the dominant position that Google, YouTube and the DoubleClick ad platform have in the marketplace".
Analysis by The Times showed that blacklists which are created to prevent digital adverts from popping up next to extremist content, are not working.
The U.K. government has ordered Google to explain why online adverts funded by taxpayers appeared alongside extremist videos on YouTube.
"With millions of sites in our network and 400 hours of video uploaded to YouTube every minute, we recognize that we don't always get it right", said Ronan Harris, Google's United Kingdom managing director, in the blog post.
Google said it would change both its technology and its policies to give more control to advertisers on its platforms.
United States women's hockey to boycott world championships over wage dispute
When the 2017 IIHF Women's World Championship kicks off in Plymouth, Michigan on March 31, the host country will not be there. And just like I said before, about how the men have the under-17 development programs, we don't have that on our side.
The spokesman said the government had suspended its advertising from YouTube. Earlier this week, Germany threatened to fine social media outlets like Facebook $53 million if they do not allow users to complain about posts containing hate-speech or fake news and if the company didn't work to remove illegal content. Germany first proposed this measure previous year and mostly targeted the publishing of fake news stories on social media.
"In the vast majority of cases, our policies work as intended, protecting users and advertisers from harmful or inappropriate content".
It is the attitude it takes towards YouTube, which is owned by Google, that will make the greatest impact.
In a letter sent to Google executive Matt Brittin, he said that it was vital for Google to "uphold the highest standards in terms of openness, transparency, and measures to avoid advertising fraud".
Google, in the blog, said, "We've heard from our advertisers and agencies loud and clear that we can provide simpler, more robust ways to stop their ads from showing against controversial content".
The Guardian and Sainsbury's said that Google's actions were unacceptable.
The company said that given the volume of content on its sites, "we recognize that we don't always get it right".
"From our founding days at Google, our mission has always been to make information universally accessible and useful", wrote Google UK Managing Director Ronan Harris.
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