The unanimous decision brought to a climax months of political turmoil that brought millions of people onto the streets in weekly protests, and triggers a new presidential election to be held within 60 days.
Park, the country's first female president, also becomes its first leader to be removed by impeachment. She is obliged to leave the Blue House and loses her executive immunity from prosecution, according to AFP.
Her actions "seriously impaired the spirit of representative democracy and the rule of law," constitutional court chief justice Lee Jung-Mi said. "President Park Geun-Hye has been dismissed."
Rival groups of supporters and opponents watched as the verdict was read out live on television.
Anti-Park demonstrators erupted with joy when the verdict was read out.
Park was found to have broken the law by allowing her friend Choi Soon-Sil -- who is already on trial for abuse of power -- to meddle in state affairs, and breached rules on public servants' activities.
Park, the daughter of a late army-backed dictator, secured the highest vote share of any candidate in the democratic era when she was elected in 2012.
She was impeached by parliament in December on charges including bribery and abuse of power, and an overwhelming majority of South Koreans -- around 77 percent -- supported Park's removal in opinion polls.