The motion, approved in a 39-3 vote, suspends Ford's authority to appoint and dismiss the deputy mayor and his executive committee, which runs the budget process. Most city councilors are frustrated by Ford's refusal to step aside since he admitted last week to smoking crack, but they lack the authority to force him out of office unless he is convicted of a crime.
An unusually subdued Ford vowed to fight the motion in court. He and his brother Doug Ford were one of the two dissenting votes against the measure.
"I can't support this and obviously I have no other options but to challenge this in court," the mayor said.
The vote came a day after yet another series of antics from Ford that outraged city councilors, anti-drunk driving advocates and even Toronto's football team.
In the span of a few hours Thursday, Ford used obscene language to deny that he pressured a female employee for oral sex, admitted that he had driven while drinking and then apologized for his vulgarity and said he was seeking professional help, though he refused to give details.
"We need to take away his power for the good of the city," said Councilor Denzil Minnan-Wong, a former ally. "The tide has turned and there are very few people that are prepared to defend him given his vulgar comments and his admission that not only does he takes drugs but that he seems to be comfortable drinking and getting behind the wheel."
Ford's troubles began escalating in May when news reports first surface of a video showing him smoking crack. After month of evading the question, the mayor admitted to having smoked crack when Toronto police announced they had obtained the video during the course of a massive drug investigation that has ensnared a close friend of Ford.
Revelations have rapidly surfaced of other startling behavior, from former aides alleging that the mayor has been frequently drunk on the job, to a video showing the mayor threatening to kill someone in an incoherent rant.
It has been a stunning decline for the 44-year-old mayor who was elected three years ago with fervent support from Toronto's conservative-leaning outer suburbs, where many voters felt angry about they considered wasteful spending and elitist politics at City Hall.
John Filion, the councilor who introduced Friday's motion, has said the goal is to prevent Ford from firing executive committee members who speak out against him.
The effort will continue Monday when the council moves to strip the mayor of most of his remaining powers. A motion, already signed by 28 of the 44 council members, will take away his budget and appoint the deputy mayor as head of the executive committee.
Earlier this week, the council voted overwhelmingly to ask Ford to take a leave of absence, but the motion was non-binding.
Ford drew gasps from reporters Thursday morning when he used an obscenity as he denied telling a staffer he wanted to have oral sex. He also threatened to take legal action against his former chief of staff, two other aides and a waiter over interviews with police that were detailed in court documents released Wednesday.
The court documents are part of a drug case against Ford's friend and occasional driver. Police interviews with Ford's ex-staffers revealed their concerns about his drug use and drunk driving, with one staffer alleging another saw Ford "impaired, driving very fast," and frightening the female employee who was in the car with him.
In another incident, Ford was described by a former staff member as being "very inebriated, verbally abusive and inappropriate with" a female staff member on St. Patrick's Day. Another former staffer reported seeing the mayor drunk in his office about 15 to 20 times in the year he worked for him.
Ford later apologized for his vulgar language Thursday and announced at a news conference that he was seeking professional health care help. He explained he was pushed "over the line" by the allegations in the newly released court documents, much of which he allegations "100 per cent lies."
He provoked a written protest from the Toronto Argonauts football team because he was wearing a team jersey when he made his coarse remarks.
No matter what the council does, Ford seems intent to remain in the limelight. The tabloid Sun News Network announced that the mayor and his brother Doug, a city councilor, will do a current events television show called "Ford Nation" on Monday nights.