The British and Irish Lions star, who is due in court next month, failed a breathalyser test and was arrested just hours after Wales beat Scotland at the Millennium Stadium.
A Welsh Rugby Union statement confirmed the 28-year-old had been suspended “for behaviour contrary to the squad’s code of conduct”.
“Andy knows he has misbehaved and is apologetic, but he also knows that he must take responsibility for his own actions and accept the repercussions,” said team manager Alan Phillips.
“This kind of behaviour cannot be tolerated in a professional, elite sporting environment and we have acted quickly and incisively in order to leave no ambiguity over the dim view we take of this situation.
“The player has made his private apologies to the Welsh management team as well as apologising in a public statement and we have also asked him to apologise to the Vale Resort Hotel, before asking him to leave the squad.
“We will now leave the South Wales Police service to conclude the matter and we will be making no further public statements at this time.”
Cardiff Blues star Powell and a second man were detained with the golf buggy at a motorway service station near the squad’s Vale of Glamorgan hotel at around 5:40am on Sunday.
Wales head coach Warren Gatland has decided against calling up a replacement for Powell, whose place has come under threat this season. The former Llanelli Scarlets player was switched from No8 to No6 but faced competition from Jonathan Thomas for that role.
South Wales Police said Powell had been charged with “driving a mechanically propelled vehicle whilst unfit through drink”. He will appear at Cardiff Magistrates’ Court on 2 March.