Five Astana riders from the Kazakhstan-based team have been caught doping since last August and as a result it had only been granted a provisional license for the 2015 season.
The world governing body said in a statement that an audit of the team, carried out by the Institute of Sport Sciences at the University of Lausanne (ISSUL), had given them "compelling grounds" to make its decision.
"The UCI considers that the ISSUL audit has, among other things, revealed a big difference between the policies and structures that the team presented to the Licence Commission in December and the reality on the ground," it said.
Astana has also been caught up in the Padova investigation by Italian police into links between professional cyclists and banned doctor Michele Ferrari, who was Lance Armstrong's personal trainer.
The UCI revealed Friday that some of the evidence it had been provided with by the Italian authorities "concerns Astana Pro Team members" and this will also be passed on to its License Commission, which is an independent four-man body, headed by a Swiss judge.
Astana has still to make a formal response to the UCI decision, but if it is stripped of its license to race at the highest level of professional cycling it would be a serious blow to Nibali and other star riders like Italian Fabio Aru.
A WorldTour license gives an automatic passport to the top races in cycling like the Tour de France, the Giro d'italia and the Vuelta a Espana, plus one-day classics such as Paris-Roubaix and Milan-San Remo.
Nibali -- who has never failed a drugs test -- would be forced to switch to another team if he wants to compete, assuming his current contract with Astana has a get out clause.
The 30-year-old Nibali captured the coveted yellow jersey of the Tour de France last July -- succeeding Team Sky's Chris Froome, who crashed out in the early stages of the 2014 edition.
Astana, the team self-confessed drugs cheat Armstrong chose to ride for in his 2009 comeback, has a controversial past and is headed by Kazakh Alexander Vinokourov, who served a two-year ban after being caught doping at the 2007 Tour de France.
The latest scandals involved brothers Maxim and Valentin Iglinskiy, who were caught using the blood-booster (EPO), while three riders from its development squad also failed drugs tests.
It led to widespread calls for the UCI, under the new leadership of Briton Brian Cookson, to take firm action and Astana was only granted its temporary license under condition that its management and anti-doping policies would face further scrutiny.
Back in 2012, the UCI stripped Katusha of its WorldTour license, but the Russian-based team successfully appealed to the Court of Arbitration in Sport to be reinstated.