In a statement, the European governing body said another Turkish club Besiktas had been banned for one season. Both bans were linked to a scandal which rocked Turkish football in 2011.
Fenerbahce, second in the Turkish league last season, will miss out on next season's Champions League which they had been due to enter in the third qualifying round while Besiktas will have to drop out of the Europa League.
Fenerbahce, who were withdrawn from the 2011/12 Champions League by the Turkish Football Federation (TFF) when the scandal broke, will also miss out on the next European competition for which they qualify.
UEFA's disciplinary panel, which has spent months collecting evidence linked to the case, also banned them for a third season, but this was suspended for a probationary period of five years.
Fenerbahce won the title in the 2010-11 season with a 4-3 win over Sivasspor in their last match, which was one of around a dozen games investigated by the TFF.
Last July, a Turkish court convicted 93 defendants, including Fenerbahce chairman Aziz Yildirim, club executives and players, in connection with the case.
Yildirim was sentenced to more than six years in prison but was released from custody after launching an appeal, which is still proceeding.
Two months before that, the TFF disciplinary committee imposed bans of between one and three years on 10 players and officials but did not take action against any clubs.
The indictment named eight clubs, including Fenerbahce, Besiktas and Trabzonspor and 14 players among the defendants.
It referred to around a dozen matches, including the Sivasspor match, which clinched the league championship on the final day of the season in 2011.
Before that decision had been made, the TFF chairman and his two deputies quit over the failure to agree on how to punish clubs caught up in the allegations.
UEFA said before the hearing that the Besiktas case involved the 2011 Turkish Cup final where they beat Buyuksehir Belediyespor on penalties after a 2-2 draw.
