Former Astros bench coach and current Red Sox manager Alex Cora is also expected to face discipline.
They were allowed to keep their World Series title from 2017, when the Astros developed a system to use an outfield camera to steal signs by their opponents.
Manfred said the Astros will be forced to give up their first AND second-round picks in both the 2020 and 2021 drafts.
While MLB's report says the sign-stealing was "player-driven", it said Luhnow and Hinch knew it was happening and did nothing to stop it.
However, Manfred determined in his ruling that no Astros players on the 2017 team would be suspended because "assessing discipline of players for this type of conduct is both hard and impractical".
Crane said that he did not think the Astros' World Series title in 2017 was "tainted". That is the only technology that I use and understand.
"While it is impossible to determine whether the conduct actually impacted the results on the field, the perception of some that it did causes significant harm to the game", Manfred said.
He said dismissing Luhnow and Hinch was "going above and beyond the MLB's penalty", adding that "we need to move forward with a clean slate".
Below are reactions from a few players and reporters, including Cleveland Indians pitchers who were torched by Houston hitters in a 2018 Division Series sweep by the Astros. Manfred nevertheless held the two responsible, pointing to a September 15, 2017, memo regarding the Red Sox's illicit use of an Apple Watch that promised severe discipline for teams that run afoul of MLB's rules against using technology during games.
Baseball's investigation began when former Astros pitcher Mike Fiers, now with Oakland, made the allegations in a report by The Athletic on November 12. Players used several methods to get the information to the batter, most famously banging on a trash can placed in the hallway between the dugout and the clubhouse at Minute Maid Park.