Once the favoured glamour haunt of the city's monied elite, the waterside Bosphorus nightclub was the scene of horror in the early hours of January 1 when an Uzbek gunman went on the rampage, killing 39 people, most of them foreigners.
The bloodshed was claimed by the Islamic State (IS) jihadist group, the first clear claim it had made for an attack in Turkey.
The club never reopened after the carnage amid reports its owner Mehmet Kocarslan was seeking a new venue outside Turkey in Greece.
The Istanbul municipality said in a statement that a demolition order had been issued because "parts of the entertainment centre violated legislation", without giving details of the infringements.
Images from the scene showed that the interior of the once famed nightclub had been completely flattened in the demolition.
Just a few upended couches gave any indication as to what the place once was. Only the entry facade had been left intact -- there was no immediate indication as to why this was the case.
The suspected gunman Abdulgadir Masharipov, 34, who spent 17 days on the run following the attack, has been held in prison since he was detained in January.
He is due to go on trial along with 56 other suspects in Istanbul on December 11, according to Turkish state media.
Prosecutors have asked that Masharipov be given 40 life sentences -- one for each victim and also for seeking to disrupt the constitutional order.
Three jailed accomplices who allegedly helped with planning -- Ilyas Mamasharipov, Abdurrauf Sert and Ali Jameel Mohammed -- risk similar penalties as does his wife Zarina Nurullayeva.
Turkish authorities said Masharipov trained in Afghanistan, adding that he confessed to carrying out the attack during the testimony.
The Reina attack, just 75 minutes into 2017, shook Turkey, a country already hit by a series of attacks in 2016 blamed on jihadists and Kurdish militants that has left hundreds of people dead.
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