The suspension by the league will begin Monday when the Bucks host the Toronto Raptors. It will continue until he's in full compliance with his treatment program.
It is the second suspension for violating the league's anti-drug program in less than a year. Sanders missed the final five games of the 2013-14 season; the center said he was penalized for using marijuana.
Sanders has had a checkered history since signing a four-year, $44 million contract extension before the 2013-14 season.
The 6-foot-11 shot-blocking center also missed time last season for 27 games with a fracture near the eye. He was also sidelined 25 games last season after surgery on his right thumb following an injury from a bar fight.
Sanders hasn't played since a Dec. 23 loss to Charlotte, having missed the last 11 games. The Bucks first said it was because of the flu before attributing his absence to personal reasons.
"We are disappointed to learn the news of Larry's suspension. We will continue to work with Larry and the league to ensure he has the support he needs," the Bucks said in a statement Friday night.
Speaking before a loss to Phoenix on Jan. 6, Sanders didn't go into detail about the reason behind his absence.
"Without these things being corrected, I don't think basketball will be something I can even do," he said then.
He said it was false to speculate he might walk off the court for good.
"But what is true," he said, "is that I'm in the process of working things out now to do as best for my psyche and my physical health going forward. There's a lot of evaluating going on. There's a lot of inside talk just to put myself in the best place for my health right now."
Sanders was taken with the 15th overall pick by Milwaukee in the 2010 NBA draft. He was averaging 7.3 points and 6.1 rebounds a game this season for the surprising Bucks.
A year after winning just 15 games, Milwaukee is 21-19 in Jason Kidd's first year as coach of the Bucks despite the absence of Sanders and a season-ending left knee injury last month to rookie Jabari Parker, the second overall pick last year's draft.