MOSCOW, NOV. 11 -- Boris Yeltsin, one of Mikhail Gorbachev's most prominent and outspoken allies, was ousted today as the Moscow Communist Party chief, marking the first removal of one of the key supporters Gorbachev brought with him to power in the Kremlin.

A plenary meeting of the Moscow party removed Yeltsin for "major shortcomings in his leadership" of the city, the official Soviet news agency Tass announced tonight. He will be replaced by Lev Zaikov, a member of the ruling Politburo, Tass said.

Yeltsin's replacement by the 64-year-old Zaikov, a former mayor of Leningrad and chief of the Soviet Union's massive military industry, is viewed by many western diplomats and some Soviets as the first concrete signal that the Kremlin leader's reform campaign is losing ground to opposition.

During his two years in office, Yeltsin, 56, campaigned vigorously for Gorbachev's policy of glasnost, or openness. He allowed conservative and liberal groups to demonstrate in the heart of Moscow in an unprecedented show of open expression.

But the straight-shooting politician encountered strong criticism from more conservative Kremlin officials and came under heavy attack in a major meeting of party leaders last month that precipitated his downfall.

The dispute over Yeltsin, which has simmered for months, erupted when the Moscow party chief gave an angry speech in a closed session of party leaders on Oct. 21.

The battle apparently has dominated the attention of Kremlin leaders in recent days. Several members of the Politburo took part in today's meeting at Moscow party headquarters.

The fight also has aroused popular support for Yeltsin in the past few days, including public warnings that "neo-Stalinists" were seeking his removal, and a campaign across the city for signatures on his behalf.

In his speech, Yeltsin attacked second-ranking Politburo member Yegor Ligachev for obstructing the Soviet leader's policies and is said to have criticized Gorbachev and his wife, Raisa, as well. Yeltsin said Gorbachev was "not reorganizing sufficiently," according to Victor Afanaseyev, editor-in-chief of the Communist Party daily Pravda.

Yeltsin has a heart condition and may be hospitalized but will nevertheless "not be left without a suitable job," Afanaseyev told visiting American newspaper editors in a meeting here today.

Yeltsin's remarks at the Oct. 21 meeting of the powerful Central Committee were deemed "politically erroneous" by today's meeting of Moscow party officials, Tass said.

In recent days, leading Kremlin officials have reported that Yeltsin offered his resignation at the end of the meeting and that he would be punished eventually for violating party discipline.

The ouster still came as a surprise to officials in the Soviet capital, who thought that Gorbachev would succeed in keeping Yeltsin in order to preserve the credibility of his glasnost policy.

Both Gorbachev and Ligachev took part in today's meeting, Tass said, adding to the drama and importance of the occasion.

The substance of Yeltsin's October remarks, summarized in vague terms by Politburo member Alexander Yakovlev and Central Committee Secretary Anatoly Lukyanov in separate news conferences recently, has not been reported in the official Soviet media.

Soviet officials have given a more detailed account of it in interviews, however.

According to those who had either attended the meeting or been briefed about it, Yeltsin made an unexpected request to speak as the plenary session was about to break for lunch.

Yeltsin, known for his brash style, told the plenum that Gorbachev's policy of perestroika, or restructuring, was progressing too slowly, sources said. He identified Ligachev with blocking implementation of some of the reforms Gorbachev has advocated.

"Yeltsin also accused other central party organs, such as various ministers and ministries," of obstructing his reforms, a Soviet official said in an interview.

Yeltsin reportedly criticized Gorbachev for lacking the backbone to oust party leaders quickly enough and rebuked the gathering of Central Committee members for refusing to give up the special privileges allowed party officials. He said he had written Gorbachev a letter outlining his grievances three months ago and complained that the Soviet leader had not answered.

Zaikov, a former metalworker, worked in defense industries in Leningrad. He was head of Leningrad's city government from 1976 to 1983 and served between 1983 and 1985 as leader of the city's Communist Party.

He became a secretary of the Central Committee in 1985 and rose to full member of the Politburo the next year.

Kremlin observers include Zaikov in the small group of Politburo members who owe their rise to power to the late leader Yuri Andropov.

The group, headed by Ligachev, is said to concentrate on economic rather than political aspects of Gorbachev's reforms and is believed to be cool to glasnost.