Serie A Giant, AC Milan have been banned from European Football for one year for breaching Financial Fair Play regulations.
Last season, Milan finished six and had qualified for the group stage of the Europa League next season.
UEFA said the club which spent £200m on transfers in one summer after takeover, breached rules around requirements for clubs to break even.
AC Milan could appeal the decision to the Court of Arbitration for Sport.
A statement read: “The Adjudicatory Chamber of the Club Financial Control Body(CFCB), chaired by Jose Narciso da Cunha Rodrigues, has taken a decision in the case of the club AC Milan that had been referred to it by the CFCB Chief Investigator for the breach of the UEFA Club Licensing and Financial Fair Play Regulations, in particular the break-even requirement.
“The club is excluded from participating in the next UEFA club competition for which it would otherwise qualify in the next two (2) seasons (i.e. one competition in 2018/19 or2019/20, subject to qualification).
“This decision may be appealed to the Court of Arbitration for Sport, in accordance with Article 34(2) of the Procedural rules governing the UEFA Club Financial Control Body, as well as Articles 62 and 63 of the UEFA Statutes.
“Atalanta will qualify straight to the group phase. Fiorentina will enter the preliminary round.