After days of crisis talks, the network confirmed on Friday morning Stefanovic had left its flagship breakfast program, Today, as a host, effective immediately.
In a video on The Karl Stefanovic Show YouTube page soon after the announcement, Stefanovic said he was now "truly independent".
That independence has been put to immediate use with Stefanovic to appear on the news and sports podcast he co-hosts with former Nine chief executive, ubiquitous AFL personality and former Who Wants to Be a Millionaire host Eddie McGuire.
"Next week (Stefanovic) will speak to me exclusively on The Long Weekend about the most tumultuous few days of his career," McGuire said on Friday at the top of his Gold FM show.
"Karl asked to take leave because of the intense negotiations and reactions to his controversial podcast with Tommy Robinson on his independent podcast."
It came not long after Stefanovic took to social media to thank his free-to-air audience of 21 years for "riding the ups and downs".
"So I'm free. Truly independent," the long-time morning television host and Gold Logie winner said.
"It wasn't easy these last couple of days, but we roll on."
It follows the release of his now-deleted podcast episode with British far-right figure Tommy Robinson, who has been accused of fuelling violent anti-immigration protests and rabid Islamophobia in the UK.
In his statement, Stefanovic said he believes in "different perspectives".
"So here's what I believe in: the public deserve to hear perspectives ... so on my show I've spoken to people who have different perspectives, I know that winds some people up," he said.
"Freedom of speech, here and around the world, is what this show is about.Â
"You don't have to listen to my show, you have the power."
Earlier on Friday, a Nine spokesperson said: "Nine Entertainment and Karl Stefanovic have agreed that it is no longer possible for him to continue hosting Today at the same time as his independent podcast.
"While Karl and Nine had previously agreed he would leave Today at the end of this year, they have subsequently decided he will leave the Network immediately."
Stefanovic's Today co-host Sarah Abo delivered a tearful message to viewers on the show on Friday morning.
"Karl has, of course, woken up with Today for 21 years, so we know this is a huge change for our viewers and of course, for us, not just here on the desk, but behind the scenes," she said.
Abo said those who have worked alongside Stefanovic know how hard he works.
Prime Minister Anthony Albanese said it was unfortunate how Stefanovic's TV career had ended.
"Words do matter, and what people who are very prominent in our public discourse do, and how they conduct themselves, matters as well," he told ABC News Breakfast.
In a note to staff, Nine's news and current affairs executive director Fiona Dear said protecting freedom of speech was core to the network's values.
"We have a rich history of interviewing controversial figures, and journalists have an obligation to ask difficult questions," she wrote.
The decision to ditch Stefanovic was not entirely surprising, the University of Sydney's Catharine Lumby told AAP.
She pointed to the host's shift from his playful breakfast larrikin persona to a more controversial role as a podcaster.
"We're living in a very unhinged world where polarisation is rife, driven by social media and their algorithms, and that includes podcasting more broadly," Professor Lumby said.
The episode with Robinson, in which Stefanovic said he admired the controversial figure's "tenacity" and "courage", was published on Tuesday evening but was pulled down by Wednesday morning.
However, the episode was resurrected on YouTube by far-right lightning rod Pauline Hanson, whom Robinson praises during the interview.
Stefanovic recently dubbed himself Joe Bogan - a reference to popular American podcaster Joe Rogan, who has courted Donald Trump and avowed conspiracy theorists.
9°C