The 32-year-old Akhtar appeared before a disciplinary committee earlier Tuesday charged with publicly criticising the country's board. He was already on two years' probation for hitting a teammate with a bat.
The ban effectively ends the controversial eleven-year career of the world's fastest bowler, which has been plagued by injuries, discipline problems and a doping scandal in 2007.
PCB chairman Nasim Ashraf told reporters.
"The committee has recommended a five year-ban on Shoaib Akthar. He will be ineligible to play in Pakistan or to play for Pakistan anywhere else in the world,"
Ashraf added."The board has lost confidence in Shoaib Akhtar and therefore felt that his presence in the field was damaging to the Pakistan team, for Pakistan players and for the image of Pakistan cricket,"
However the PCB chief said that Akhtar would still be able to play for other teams around the world, clearing the fast bowler to play for the
lucrative Indian Premier League next month.
Ashraf added that it was a
"sad day for me and for Shoaib Akhtar. He is such a talented player."
The PCB chairman said Akhtar had the right to appeal the decision.
Because he was already on probation, Akhtar faced a theoretical life ban for slamming the PCB for dual standards on awarding central contracts in January this year.
In October last year, Akhtar was fined 3.4 million rupees (52,000 dollars) and banned for 13 matches for hitting fellow paceman Mohammad Asif with a bat, just days before the start of the Twenty20 World Championships in South Africa.
Spinner Danish Kaneria, who also faced a charge of criticising the PCB, was severely reprimanded, Ashraf said.
Kaneria had criticised his demotion from category "B" to "C" in the central contract in an online column. He later blamed a newspaper for publishing his column out of context.
"Since this was Kaneria's first offense on discipline, he has been severely reprimanded and barred from issuing any press statements,"
Akhtar was dropped from Pakistan's list of 15 contracted players in January after the paceman had another disappointing year, plagued by injures and discipline problems.
Instead, Akhtar was offered a special retainer deal, which he refused to sign.
The mercurial fast bowler last played for Pakistan in the third and final Test against India at Bangalore in December last year. He broke down with back trouble and was blamed for Pakistan's 1-0 defeat in the series.
He was not selected for Pakistan's five-match series against Zimbabwe in February and was omitted from next month's first two limited overs international against Bangladesh.
Akhtar took 178 wickets in 46 Tests, while his tally in 138 one-day matches stands at 219.