On Monday, the council transferred most of Mr Ford's budget and many of his powers to the deputy mayor.
Mr Ford, 44, who has promised to fight the council's decisions, criticised the vote as a "coup d'etat".
The mayor of Canada's largest city has faced intense pressure to resign after admitting to smoking crack cocaine
In recent weeks he has also acknowledged buying illegal drugs while serving as mayor.
Mr Ford abstained from Monday's vote, but promised "outright war" in the next election against the councillors who opposed him.
"What's happening here today is not a democratic process, this is a dictatorship," he told the city councillors.
"You are absolutely telling everybody that voted in the last municipal election that their vote does not count."
And Mr Ford refused to apologise, saying he had done enough apologising already.
"I've admitted my mistakes," he said. "I'm not going to sit here and go on and on and on."
Earlier in the heated council meeting, Mr Ford ran through the gallery, accidentally knocking over city councillor Pam McConnell before catching her.
Ms McConnell was later seen holding ice to her lip.
Monday's motion reduces Mr Ford's office budget by 60%, and allows mayoral staff to join deputy mayor Norm Kelly, largely making Mr Ford mayor in name only.
Profile: Rob Ford
The council does not have the power to remove Mr Ford from office unless he has a criminal conviction.
Councillor Denzil Minnan-Wong, once a Ford ally but now one of his most outspoken critics, said the mayor's conduct was embarrassing the city.
"He's the worst spokesman for the city of Toronto right now," he said.
The Toronto council began stripping away his powers on Friday, voting 39 to 3 to prevent him from being able to dismiss the deputy mayor and taking away his emergency powers.
Despite the scandal, Mr Ford does not seem inclined to shun the spotlight.
He gave interviews to US media organisations at the weekend and appeared at a Toronto Argonauts game, despite the Canadian Football League commissioner suggesting he not.
Mr Ford and his brother Doug Ford, a city councillor, launched their own current events television programme on Monday evening.
The show, Ford Nation, is named after the bloc of conservative, suburban voters who put Mr Ford in office in 2010.
The mayor told viewers they would see a change in him over the next few months, saying that he had not touched alcohol in a number of weeks.
"I'll take a urine sample right now,'' he said on the pre-recorded show.
On Sunday, Mr Ford told US broadcaster Fox News he had "admitted to drinking too much", but said he was dealing with it, including going to the gym two hours every day.
"I'm seeking professional help, I'm not an alcoholic, I'm not a drug addict," he said. "Have I had my outbursts in the past? Absolutely.
"But you know what, I'm only human. I've made mistakes. I've apologised."
He added: "Yes, one day I do want to run for prime minister."
The Toronto mayor apologised again on Thursday for making an obscene outburst on live television while denying he had offered oral sex to a female staff member.
He had been responding to allegations in court papers that he had also driven drunk, used racially abusive language, threatened staff and consorted with an alleged prostitute.
The Toronto city council has voted to strip Mayor Rob Ford of most of his authority, as the embattled city leader resists growing pressure to step down.