Miss California pageant officials said Wednesday that Prejean was fired because of continued breach of contract issues.
"This was a decision based solely on contract violations including Ms. Prejean's unwillingness to make appearances on behalf of the Miss California USA organization," executive director Keith Lewis said in a statement sent to ABCNews.com. "After our press conference in New York we had hoped we would be able to forge a better working relationship. However, since that time it has become abundantly clear that Carrie is unwilling to fulfill her obligations under our contract and work together."
Even Trump, the real estate mogul who co-owns the Miss USA organization and saved Prejean from losing her crown last month, did not stand in the way this time.
"I told Carrie she needed to get back to work and honor her contract with the Miss California USA Organization and I gave her the opportunity to do so," Trump said in the statement. "Unfortunately it just doesn't look like it is going to happen and I offered Keith my full support in making this decision. Carrie is a beautiful young woman and I wish her well as she pursues her other interests."
Prejean's representative did not respond immediately to requests for comment from ABCNews.com.
Miss California runner-up Tami Farrell will immediately take over the crown and Prejean's responsibilities as Miss California. The current Miss USA Kristen Dalton and Miss Universe Dayana Mendoza will also lend a hand in making appearances.
Last month, Trump stood by the scandalized beauty queen, who ignited a firestorm of scrutiny when she spoke out against "opposite marriage" at the 2009 Miss USA pageant and semi-nude photos of her appeared on the Internet.
"[Prejean] gave a very, very honest answer when asked a very tough answer at a recent pageant. It's the same answer that the president of the United States gave. It's the same answer that many people gave," Trump said on May 12 at a press conference. "If her beauty wasn't so great, nobody really would've cared."
About the 21-year-old beauty queen's semi-nude photographs, more of which appeared online,Trump added: "We have determined that the pictures taken are fine. ... In many cases, they were very lovely pictures."
Prejean spoke after Trump, thanking the organizations behind the pageant along with her family and her supporters. Without mentioning his name, she lashed out at Perez Hilton, the Miss USA pageant judge who asked what she thought of same sex marriage on April 19.
"Three weeks ago I was asked a politically charged question with a hidden personal agenda," Prejean said. "I was given a question asking for my opinion and I stated my personal belief. Immediately after the pageant, judge no. 8 began a cultural firestorm in the media ... he was trying to be self-promoting and hateful.
"On April 19 on that stage, I exercised my freedom of speech," Prejean continued, fighting back tears. "And I was punished for doing so. This should not happen in America."
Despite feeling like she was unfairly victimized, Prejean said she forgives Hilton and everyone who criticized her following the pageant. Asked to respond to Prejean's statement, Hilton said simply, "She forgives me and I forgive her."