"I strongly disapprove of anyone who makes derogatory remarks against any caste, creed or religion. I have dismissed Dr (Damodar) Rout from the Council of Ministers," Mr Patnaik told reporters in Bhubaneswar.
Damodar Rout is also the Biju Janata Dal vice-president.
The chief minister said, "A letter has been sent to the Hon'ble Governor in the evening to accept this dismissal."
Damodar Rout was not immediately available for comment as he was in his constituency.
The removal of the minister followed state-wide protests by Brahmins against the "derogatory" and controversial remarks he had made about the community at a function in Malkangiri on December 17.
The veteran leader, who represents Paradip in the Assembly, said that "while no tribal is seen begging in any part of the state, one can spot Brahmins resorting to begging in places such as bus stands".
The remarks of the 75-year-old leader triggered sharp reaction across the state and members of the Brahmin community were up in arms demanding his immediate removal from the Council of Ministers and unconditional apology from him.
Terming Damodar Rout's remarks as casteist and inappropriate, Brahmins, who constitute about nine per cent of the state's population, staged demonstrations and dharnas in different places to press their demand.
The senior leader, who celebrated his birthday last week, has been in the eye of a storm for quite some time as his remarks in the past had also triggered controversies and protests from various segments of society.
The seven-time MLA was under severe attack after his remarks about a spate of suicide by farmers in the state allegedly due to crop loss caused by different reasons such as pest attack and unseasonal rains.
While refusing to visit the house of a farmer in Bargarh district who had committed suicide, Damodar Rout had stated that the farmer who had died did not belong to BJD and therefore, there was no reason for him to meet his family members.
His remark that no compensation would be provided to the farmers who had set afire their pest infested crops had also evoked strong protest from different quarters.
The veteran leader had also made controversial remarks about a woman BJP leader and Anganwadi workers in October this year. He later expressed his regret for his comments.
Damodar Rout, who is considered a confidant of late Biju Patnaik, found place in all the four ministries headed by Naveen Patnaik, but he failed to enjoy full term as minister in any of the tenures. He had earlier been asked thrice to resign because of different reasons. This was for the first time that he was removed from the Ministry.
Since 1979, Damodar Rout had been in charge of more than 15 different departments during his long political innings after he became MLA for the first time in 1977.