Salazar visited the oyster farm last week and said he did not make the decision lightly.
Point Reyes National Seashore was added to the national parks system by Congress in 1962, and protects more than 80 miles of California coastline.
The Interior secretary also has the power to lease the park's lands for dairy and cattle-ranching purposes. Currently there are 15 beef and dairy ranches operating along the Point Reyes seashore. Those ranches will remain open under the decision Thursday.
Oyster farm owner Kevin Lunny, whose family also operates one of the cattle ranches, said he was disappointed by the decision and was still trying to figure out his next move. He had been asking for a 10-year extension of his lease.
"This is going to be devastating to our families, our community and our county," Lunny said. "This is wrong beyond words in our opinion."
He said Salazar called to tell him about the decision.
Lunny bought the oyster company in 2004, knowing the lease expired in 2012. But his lawyers felt an extension could be negotiated, so he decided to take on the fight.
The company will have to remove its property from park land and waters within 90 days. Because the lease was set to expire, the company gets no compensation for the decision.
Salazar did not stop all commercial activities in the park. He sought to extend the terms of the cattle ranch leases from 10 to 20 years.
"Ranching operations have a long and important history on the Point Reyes peninsula and will be continued at Point Reyes National Seashore," he said.
Environmentalists and the National Park Service said the farm's operations threatened nearby harbor seals and other native species. The area is a key pupping site for the seals.
The oyster farm had many powerful allies who fought vociferously on its behalf. Many hailed the oyster operation as an example of sustainable aquaculture and the local foods movement.
Sen. Dianne Feinstein, D-Calif., and the National Academy of Sciences claimed park officials were trying to get rid of the oyster farm by exaggerating its negative impacts on the environment.
On Thursday, Feinstein said she was extremely disappointed by the decision by Salazar that will put 30 people out of work.
"The National Park Service's review process has been flawed from the beginning with false and misleading science," she said in a statement.
To resolve the dispute over the seals, more than $1 million in taxpayer money was spent on environmental assessment studies, according to records. That study was used by Salazar to make his final decision.
California's other senator, Barbara Boxer, voiced support for Salazar's choice, saying he made his decision based on science and law.
Conservationists rejoiced at the move, saying it will return one of the few coastal wildernesses in the country to its natural state.