Black has also been stripped of his honorary position in the Privy Council of Canada, at the recommendation of Prime Minister Stephen Harper.
The announcement came in a terse release by Gov. Gen. David Johnston late Friday.
A spokeswoman for the Governor General, Marie-Pierre Belanger, says an advisory council met Friday afternoon to make its recommendation to Johnston.
The council's members include the chief justice of the Supreme Court of Canada, Beverley McLachlin, and Wayne Wouters, the clerk of the Privy Council, Canada's top public servant.
Friday's announcement means Black can no longer attach the initials O.C., and P.C., to his name. Belanger also said Black must return the insignia of the order.
"The insignia of the Order of Canada remain the property of the Order at all times," she said.
"They are presented in trust to members of the Order, as a visible sign of their appointment and a mark of esteem. When an appointment ends, whether through death or through an ordinance made by the Governor General, the insignia reverts to the Order."
Last November, the Federal Court of Appeal dismissed an application by Black to personally address the advisory council that had been weighing whether he should be stripped of the Order of Canada. Belanger said Black was allowed to make written submissions.
The 11-member advisory council reviewed Black's membership in the order following his 2007 convictions for fraud and obstruction of justice in the United States. Black was given Canada's highest honour in 1990.
Five other Canadians — Alan Eagleson, David Ahenakew, T. Sher Singh, Stephen Fonyo Jr. and Garth Drabinsky — have been stripped of the Order of Canada. The Governor General's office said the decisions in these cases were based on various reasons, including being convicted of a criminal offence, a recipient committing actions not befitting of the honour, or a recipient being fined or reprimanded by a professional organization or association.
Black has been involved in a string of legal battles related to his U.S. convictions on fraud and obstruction of justice charges when he was the head of the Hollinger newspaper business.
Black has argued repeatedly that the U.S. case against him was the result of an unfair prosecution, pointing to the fact that an appeals court later tossed two of the three fraud convictions against him and two other Hollinger executives.
In the end, he served 37 months of a 42-month sentence in a Florida prison and returned to Canada in May of 2012. He had to return under a special temporary permit, having renounced his Canadian citizenship in 2001 so he could accept a peerage in the British House of Lords.
Black, who is now back in Toronto, is a columnist for the National Post and co-hosts a current affairs talk show.
In the original citation conferring the Order of Canada in 1990, Black was described as "a distinguished Toronto entrepreneur and publisher, ... a man of diverse achievements within the realms of Canadian commerce, education, literature and the arts."
"In addition to his various business ventures, which have enhanced Canada's visible presence internationally, he is well known for his generous support of many charitable endeavours, notably the Clarke Institute of Psychiatry."