Cameroon's ability to host the finals was first questioned when CAF announced in July previous year that the tournament would have eight additional teams and only countries capable of putting on world-class tournament, with complete facilities and extensive infrastructure would be allowed to stage the event.
The new host is expected to be named before the end of the year, a CAF executive committee member told Reuters. South Africa, hosts of the 2010 World Cup, could also be a viable option for CAF.
"After numerous discussions and following inspections over the past 18 months CAF has become aware that several conditions of conformity have not been met", a CAF statement explained.
The African soccer body gave Cameroon a final chance by planning two more inspection visits in October.
For journalist Pierre Youte "it's perhaps a good decision. like this Cameroon will have the time to learn and find the means to host a CAN worthy of the name".
The Cup of Nations is no stranger to dramatic subplots.
Morocco have been touted as potential hosts, having stepped in to hold this year's African Nations Championship after Kenya were deemed not ready.
The country's status as hosts of AFCON has been in doubt for the last few months since the decision was made to increase the tournament from 16 to 24 teams.
Local and worldwide news outlets have repeatedly speculated this year that Morocco might replace Cameroon.