Price signed a three-year £1.5m deal with the retailer to produce the range in 2006. According to reports, the range has not been selling well despite heavy discounting.
According to a report in the Daily Mirror, the decision to axe the range was also influenced by the poor publicity surrounding Price since her break-up with Peter Andre and her subsequent romance with cross-dressing cage fighter Alex Reid.
Asda's decision to drop Price follows a fallout between the retailer and the model over comments she made about scars on her breasts while appearing on her TV show 'What Katie Did Next'.
The programme was broadcast while Price was promoting Asda's Tickled Pink breast cancer charity. Shortly afterwards she was axed from the campaign.