An investigation into a story by Relotius about immigration and the US-Mexican border revealed that he had fabricated information about seeing a hand-painted sign in a town in Minnesota that read: "Mexicans Keep Out."
Fraudulent information appeared in other stories including one about inmates at the US military prison at Guantanamo Bay and another about the US NFL quarterback Colin Kaepernick.
Relotius, who joined the publication as a freelancer in 2011, told the magazine he regretted his actions and was deeply ashamed.
He has written some 60 articles for the magazine, many of which he has said are accurate.
The Hamburg-based publication, which has apologised to its readers, said it was "shocked" by the revelations, describing them as "a low point in Spiegel's 70-year history".