Japan catches about 1,000 whales each year for what it calls scientific research.
Australia filed a case with the ICJ in May 2010, arguing that Japan's programme - under which it kills whales - is commercial whaling in disguise.
The court's decision is considered legally binding.
Japan had said earlier that it would abide by the court's ruling.
Reading out the judgement on Monday, Presiding Judge Peter Tomka ordered a temporary halt to the programme.
The court said it had decided, by 12 votes to four, "that Japan shall revoke any extant authorisation, permit or licence granted in relation to JARPA II [Japan's whaling programme in the Antarctic] and refrain from granting any further permits in pursuance of that programme".
In a statement, the court said that Japan's programme involved activities which "can broadly be characterised as scientific research".
The decision is a major victory for Australia and environmental groups that oppose whaling on ethical grounds, though it will not mean the end of whaling.
Japan has a second, smaller program in the northern Pacific. Meanwhile Norway and Iceland reject a 1986 moratorium on commercial whaling imposed by the International Whaling Commission and conduct for-profit whaling.
Nevertheless, environmental groups rejoiced.
The ruling "certainly has implications ultimately for whaling by Iceland and Norway as well," said Patrick Ramage, director of the International Fund for Animal Welfare's whale program, outside the courtroom.
"I think it will increase pressure on those two countries to re-examine their own whaling practices and the various reasons and pretexts given for that whaling activity."
Japan had argued that Australia's suit was an attempt to force its cultural norms on Japan, equivalent to Hindus demanding an international ban on killing cows.
Though consumption of whale meat has declined in popularity in Japan in recent years, it is still considered a delicacy by some.
Japan has pledged to abide by the court's ruling.
The ruling on March 31 found that killing whales for scientific purposes would be justifiable under international law in the context of a better-designed study.
Japan's program was supposed to determine whether commercial whaling of some species can resume without bringing them in danger of extinction.
The ruling noted among other factors that Japan had not considered a smaller program or non-lethal methods to study whale populations.
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