The decision comes after Polish fans caused havoc during their clubs away tie in Vilnius, storming the pitch at half time and fighting with local police. The police were forced to use water cannons and even rubber bullets to keep the rampaging Poles at bay.
The away fans were unhappy at their teams dismal first half display which saw them 2-0 down at the hands of the little known Lithuanian outfit. The game was abandoned but UEFA awarded a 3-0 victory to FC Vetra.
UEFA have also banned Legia from any kind of European competition next season - should they qualify - and have ordered the Polish club to pay compensation for the damage caused to the FC Vetra stadium.
"With Legia's considerable disciplinary record for away matches, the duty of playing matches against Legia becomes a tall order that UEFA cannot afford to support any longer," concluded UEFA's official report.
"Legia must act quickly and firmly if the club wishes to participate in European competition in the future."
Legia have until Saturday to lodge an appeal.