The 41-year-old Klitschko controlled the fight in the first three rounds, keeping his previously undefeated opponent at bay with his left jab.
The 27-year-old challenger tried to fight back before suffering a gash over his right eye.
With blood pouring down Charr's face, referee Guido Cavalleri ended the fight with less than a minute left in round four after consulting the ring's doctor.
Charr, who had a 21-0 record with 11 knockouts coming into the fight, was furious at the decision, kicking and punching at the ropes.
He challenged the Ukrainian to continue before being restrained by his trainers, with the pro-Klitschko crowd at Moscow's Olympic indoor arena booing and whistling at the German.
Klitschko, who won a unanimous points decision against Britain's Dereck Chisora in February, improved his record to 45-2 with 40 knockouts.
"I'm disappointed I didn't manage to win the fight with a real knockout," he told Russian television. "Sadly, it was the doctor's decision. We both wanted to continue the fight."
Klitschko has held the WBC title since 2004 with his younger brother Vladimir holding the WBA, WBO and IBF heavyweight belts.