The report, led by a law firm, said 45 out of the 83 allegations made against Wallace during his time on the show between 2005 and 2018 were substantiated.
It said the majority of the claims related to "inappropriate sexual language and humour", with one incident of unwelcome physical contact.
Wallace, 60, stepped away from hosting the hit BBC reality show, which is made by an independent production company, in 2024 while an investigation was launched into allegations made by multiple women that he made inappropriate sexual comments and behaved inappropriately over 17 years.
The BBC has come under pressure over how it handles sexual misconduct allegations and how Wallace had continued to front some of its most popular shows for so long despite the complaints.
The broadcaster issued a statement of apology, adding Wallace's "return to MasterChef is untenable".
"The BBC has informed Mr Wallace we have no plans to work with him in future," it said.
"Although the full extent of these issues were not known at the relevant time, opportunities were missed to address this behaviour, both by the production companies running MasterChef and the BBC."
The broadcaster previously said Wallace was warned by his employers after a complaint in 2018, and an internal investigation at the time found his behaviour was "unacceptable and unprofessional".
The latest investigation found that there was little or no formal training or clear escalation procedures in place for staff - many of those working on the show were freelancers - leading to under-reporting and normalisation of inappropriate behaviour.
Wallace has strongly denied the claims. In December, he drew an angry backlash after he alleged that complaints about his behaviour came from "a handful of middle-class women of a certain age".
In a statement posted on his Instagram account last week, he said: "I will not go quietly. I will not be cancelled for convenience. I was tried by media and hung out to dry well before the facts were established."
MasterChef is one of the BBC's most popular and long-running competition shows, and has been adapted in other countries including MasterChef Australia.
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