A Blues statement read: "Following a management meeting on Monday morning Cardiff Blues can confirm that Gavin Henson has been dismissed with immediate effect."
Chief executive Richard Holland said: "The Cardiff Blues management have discussed the matter at length but have acted swiftly since the incident occurred on Saturday morning.
"Gavin admitted himself that his behaviour was totally unacceptable and the immediate termination of his contract sends out a clear message that behaviour like that will not be tolerated at the Blues.
"We have a duty to our supporters and sponsors to protect the good name of Cardiff Blues and those associated with our brand.
"Gavin Henson is obviously a talented rugby player and it's unfortunate that his career at the Blues has ended this way.
"However, we would like to thank him for his service and wish him the best of luck with his future career."