The decision to expel former archbishop Francisco Jose Cox Huneeus and former bishop Marco Antonio Ordenes Fernandez - the latest heads to roll in a country hit hard by the cleric abuse scandal - is not open to appeal.
Pope Francis has defrocked two Chilean bishops accused of molesting minors, as he tries to tackle the Catholic Church's sexual abuse scandals around the world.
The Vatican said on Saturday that Francisco Jose Cox Huneeus, 84, the former archbishop emeritus of La Serena, and Marco Antonio Ordenes Fernandez, 53, who was archbishop emeritus of Iquique, were expelled from the priesthood following local and Vatican investigations.
Defrocking, officially called being "reduced to the lay state", is the harshest punishment the Church can inflict on a member of the clergy and such action has rarely been taken against bishops.
It comes as the Church faces sexual abuse crises in Chile and a host of other countries, including the United States, Germany and Australia.
The move prompted speculation that it could be a harbinger of action against other prelates, perhaps including Theodore McCarrick, the former archbishop of Washington, DC.
McCarrick lost his title of cardinal in July after a US Church investigation found "credible and substantiated" allegations that he abused a minor decades ago.
He denies wrongdoing.
The pope ordered McCarrick, once of the US Church's most prestigious figures, to go into seclusion and live a life of prayer. But he is still an archbishop and priest, pending a Vatican investigation.
Last month Francis defrocked Father Fernando Karadima, an 88-year-old Chilean priest who was accused of sexually abusing teenage boys over many years.
Chile's scandal prompted all of the country's 34 bishops to offer their resignation to the pope last May.
He has so far accepted seven.
Cox and Ordenes were not among the 34 because, although they still had the clerical rank of bishop before Saturday, they were no longer running dioceses.
Chilean president pays a visit
The Vatican's announcement came shortly after the pope and Chilean President Sebastian Pinera discussed the crisis at a meeting in the Vatican.
"We shared the hope that the Church may experience a renaissance and recuperate the affection, the closeness of the people of God, and can continue playing the important role that the Church plays in our country," Pinera told reporters.
Earlier this month, the religious order to which Cox belongs, the Schoenstatt Fathers, said the Vatican was investigating an accusation against him relating to the sexual abuse of a minor in Germany in 2004.
Cox, who is believed to have returned to Germany after a period in Chile, could not be reached for comment.
According to Chilean media, Ordenes, who resigned as bishop of Iquique in 2012 while under Vatican investigation, was accused of molesting an underage altar boy years ago.
He is believed to be living somewhere in Chile.
It was not immediately possible to reach him for comment.
Chilean civil justice has investigated 119 allegations of sexual abuse or cover-ups involving 167 church workers including Cardinal Ricardo Ezzati, the archbishop of Santiago.