Katona had appeared in the TV ads for over four years following her success on reality show I'm A Celebrity, Get Me Out Of Here. Iceland uses a number of well-known personalities for its advertising, including Loose Women's Coleen Nolan.
An Iceland spokesperson said: ‘For most of that time, she has been a successful part of our advertising campaigns, but has also been through some tough times in her personal life.
‘We have always stood by her, as an example of a normal person and mum who has experienced some of the modern-day culture of fame, and how difficult it can be to deal with. However, following the most recent allegations, we feel it is impossible for Kerry to continue to work with us as one of the faces of Iceland advertising,' added the statement.
The retailer vows to stand by Katona and ensure she receives ‘appropriate support'.