Basic Box has cancelled the contract and instructed its lawyers Harbottle & Lewis to begin proceedings to recover damages, reported to be in the millions of pounds.
Earlier this month, Aguilera talked publicly about celebrities putting their name to clothing ranges. She said: "I just think it's so tacky. I have always thought that it's one of those things that just makes people look like they don't know what to do any more."
A Basic Box spokesman said: "We had understood that she was completely behind the project so, not surprisingly, her comments came as something of a shock.
"Basic Box has already invested considerable sums in the project and in the light of her comments we had no choice but to terminate the agreement immediately."
Despite featuring in many worst-dressed lists, Aguilera's image has appealed to a number of mainstream brands eager to play on the success of the singer, whose hits include 'Genie in a Bottle' and 'Dirrrty'.
She has played up to her sexy image in a high-profile Virgin Mobile TV campaign and an international campaign for US footwear brand Skechers, as well as lending a song to a Mercedes A Class ad.
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