The 56-year-old comedian has co-hosted CNN's New Year's Eve special alongside Anderson Cooper since 2007. On Wednesday, CNN tweeted that it has "terminated" its agreement with Griffin, despite her apology on Tuesday.
"CNN has terminated our agreement with Kathy Griffin to appear on our New Year's Eve program," the network's official Twitter account posted on Wednesday.
ET has reached out to Griffin for comment.
A source with knowledge of the situation tells ET that Griffin "crossed the line."
"Both Anderson [Cooper] and [CNN President] Jeff Zucker thought it was disgusting and way out of line," the source says. "Neither of them felt comfortable with having her back, so that sealed it. Anderson likes Kathy, and Jeff liked the awkward dynamic between the two, but she was always polarizing."
In an earlier statement obtained by ET, CNN also called the photo shoot "disgusting and offensive," though said they were still "evaluating" Griffin's annual New Year's Eve gig.
"We found what she did disgusting and offensive," the statement read. "We are pleased to see she has apologized and asked that the photos be taken down."
Meanwhile, Cooper echoed the network's statement.
"For the record, I am appalled by the photo shoot Kathy Griffin took part in," the 49-year-old journalist tweeted on Tuesday. "It is clearly disgusting and completely inappropriate."
Fallout for Griffin's photo shoot with photographer Tyler Shields has been swift. Her Route 66 Casino appearance scheduled for July 22 has also now been canceled.
Griffin said she "went way too far" in a video she tweeted on Tuesday apologizing for the photo.
"I'm a comic. I crossed the line," she said. "I moved the line, then I crossed it. I went way too far."
"The image is too disturbing," she continued. "I understand how it offends people. It wasn't funny. I get it. I've made a lot of mistakes in my career. I will continue. ... I beg for your forgiveness."