At a hastily-arranged news conference attended by shell-shocked members of the first team squad, including World Player of the Year Lionel Messi, Barca president Sandro Rosell said Vilanova would be having treatment that meant he will be unable to continue in his current role.
"We are here to give you some news that I would have liked never to have had to give," said a grim-faced Rosell, adding that the club had decided to cancel Saturday's friendly against Polish side Lechia Gdansk.
"Life goes on, this is a very severe blow but Barca always comes through and this time it will be no different," Rosell said.
Vilanova, 44, has been battling throat cancer since shortly after he was promoted from assistant coach to succeed Pep Guardiola at the end of the 2011-12 season.
He had a tumour removed from his saliva glands in November 2011 before a second round of surgery a year later and his number two Jordi Roura later took charge while he relocated to New York for two months for a course of chemotherapy and radiotherapy, returning at the end of March.
Only on Tuesday, in his first news conference since the players returned from holiday, he spoke of his excitement about the new season and the prospect of seeing new signing Neymar playing alongside World Player of the Year Lionel Messi.
As messages of support flowed in on Twitter from both within and beyond the sporting world, including from Barca's arch rivals Real Madrid, speculation began about who the club would target for one of the most sought-after jobs in world football.
Barcelona-based newspaper Sport and other media reported that Joan Francesc Ferrer, known as "Rubi", may be in line to take over.
Ferrer led Girona to the second division play-offs last season and was appointed Vilanova's assistant for the coming campaign to help with technical analysis of Barca's rivals.
Other names mentioned, all former Barca players, included Swansea manager Michael Laudrup, Celta Vigo's Luis Enrique and Ajax's Frank de Boer. Andre Villas-Boas, manager of Tottenham Hotspur, was also considered a possible candidate.
Vilanova and Guardiola, now coach of Bayern Munich, were at Barca's academy together and coached the B side for a year together before stepping up to the first team in 2008.
They led the club on a spectacular four-year run including two Champions League crowns and three La Liga titles.
Last season, Vilanova helped Barca to a fourth La Liga success in five years as they equalled Real Madrid's record points haul from the previous term of 100.
His record in 44 official matches as coach was 32 wins, seven draws and five defeats.
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- Lionel Messi
- Sandro Rosell