Anelka, who was given a five-match ban by the FA following his controversial 'quenelle' salute during a match on Dec. 28, had earlier said on Twitter he was quitting the Midlands team.
"The club considers the conduct of Nicolas Anelka on December 28, coupled with his purported termination on social media this evening, to be gross misconduct," West Brom said.
"As a result the club has tonight written to Nicolas Anelka giving him 14 days' notice of termination as required under his contract," they added on their website.
Anelka, who turned 35 on Friday, made the 'quenelle' salute, which is associated with anti-Semitic sentiments, when he scored the first of his two goals in a 3-3 draw in a league game at West Ham United's Upton Park ground.
Earlier on Friday, the former France striker tweeted that he was quitting the club but West Brom said they had not received any official notification of his intention to end his contract.
"Following my talks with the club I've been told I could be back in the squad under certain conditions that I can't agree," Anelka said on his Twitter account (@anelkaofficiel).
"As I want to preserve my integrity I've decided to free myself and to put an end to my contract with WBA with immediate effect."
West Brom responded with a statement saying: "... Nicolas Anelka is unwilling to agree to the conditions set by it (the club) which may have enabled his suspension to be lifted and for him to resume training.
"These conditions were, firstly, that the club required (him) to apologise to it, its supporters, sponsors and the wider community for the impact and consequences of his gesture made on December 28, and secondly, that he accept a substantial fine.
"Nicolas Anelka's purported termination of his Premier League contract this evening via social media was invalid as this was not conducted under the correct legal process as required by his contract."
West Brom, fourth from bottom of the table and one place above the relegation zone on goal difference, had earlier criticised Anelka for a lack of professionalism.
"The club notes Nicolas Anelka's comments on Twitter this evening. However the club has received nothing formally regarding the termination of Nicolas Anelka's contract from either him or his advisers.
"The club regards the release of such a statement on social media as highly unprofessional...
"The club confirms it has been continuing discussions with Nicolas Anelka and his advisers as part of its own internal enquiry into the gesture he made...," added West Brom.
"Following the conclusion of the FA's enquiry into the same incident the club had hoped to conclude its own investigations next week."
After receiving his five-match ban from the FA and an £80,000 fine last week for the 'quenelle' salute, the Frenchman said on Thursday he would not contest the suspension.
The FA, who wanted a longer ban, also said they would accept the sanction imposed by its independent regulatory commission.
Anelka said the salute, devised by his friend Dieudonne M'bala M'bala, was a sign of allegiance with the French comedian and that he was using it as an anti-establishment gesture.
The FA accepted that while the gesture is deemed to be anti-Semitic, Anelka was not an anti-Semite.
Anelka's sacking by West Brom could signal the end of a long career for the striker who played 69 times for France and featured for a host of Europe's top clubs.
Anelka was part of Real's Champions League-winning team in 2000 and, in all, his aggregate transfers were worth close to £90 million.
He signed for West Brom as a free agent after leaving Juventus at the end of last season and played 12 times for the Midlands club, scoring twice.
- Sports & Recreation