Hogan debuted in 1977 and is one of the best-known names in the industry.
Hogan has apologised, telling People: "It was unacceptable for me to have used that offensive language; there is no excuse for it."
The comments referred to came in audio transcripts seen by RadarOnline.com and The National Enquirer.
WWE did not link the termination to the tape, saying "WWE terminated its contract with Terry Bollea (aka Hulk Hogan).
"WWE is committed to embracing and celebrating individuals from all backgrounds as demonstrated by the diversity of our employees, performers and fans worldwide."
However his lawyer said Hogan had resigned rather than being fired.
Hogan told People he was disappointed with himself: "This is not who I am. I believe very strongly that every person in the world is important and should not be treated differently based on race, gender, orientation, religious beliefs or otherwise."
He had earlier tweeted this cryptic message.
According to RadarOnline and The National Enquirer, Hogan's comments were made in an audio recording submitted as evidence in his legal battle with gossip site Gawker, who he is suing over the publication of a sex tape.
In transcripts seen by the two organisations, Hogan allegedly tells Heather Clem - a friend's wife with whom he was filmed having sex - "I guess we're all a little racist" and uses racist language while referring to his daughter's love life.
The WWE has scrubbed references of Hogan from its website.
Hogan has enjoyed huge popularity in his long career as a professional wrestler, with his rise helping the expansion of the industry.
In the glory days of "Hulkamania", Hogan was a multiple winner of the WWE's top titles, as well as serving a successful stint in rival WCW.
He returned to the WWE last year for the fourth time after more than six years away from the organisation.
World Wrestling Entertainment (WWE) has terminated its contract with Hulk Hogan, after a tape emerged of him using racist slurs.