The company have made the decision on health and safety grounds, following the fire on an outside deck of Portsmouth-Fishbourne car ferry St Faith, in January.
Smoke could be seen coming from the middle of the Solent.
An investigation into the incident found the fire started in a cigarette bin.
The announcement comes as another fire, on car ferry St Clare, started on Wednesday evening. The company are still looking into how it was caused.
Wightlink chief executive Keith Greenfield, said: ‘We’ve been considering this policy for some months especially as most other public transport is smoke free. But the recent fire on St Faith, which started in a cigarette bin on an outside deck, confirmed that we should move forward and become a smoke free ferry service.
‘We know our customers will enjoy a healthier, safer and cleaner service as a result.’
All Wightlink’s cross-Solent sailings are short and passengers only spend around half-an hour-on a ship before disembarking.
The company said people can smoke before they get on board, and after they leave the ship.
Wightlink will support staff who would like to take this opportunity to give up smoking.
For more information, visit wightlink.co.uk.