The four-game league suspension, which is without pay, stems from Walton's three offseason arrests between January and March.
The Dolphins have been in communication with the NFL for several weeks, and they were aware a suspension was likely coming before they traded Kenyan Drake to the Arizona Cardinals for a conditional sixth-round pick last month.
Walton, who has been the Dolphins' starting running back the past four games, will be eligible to return Dec. 2 following the team's Week 13 game against the Philadelphia Eagles. He is allowed to be in the facility and attend meetings during the suspension, but he won't practice, play or receive his salary during the next four weeks.
In a statement, Walton said he takes "full responsibility" for his actions.
"I want to thank the Dolphins for giving me this opportunity and will make the most of this chance as a person and a player when I return," he said.
Miami will turn to Kalen Ballage to again be their lead back during Walton's absence. Ballage began the season as the Dolphins' starting running back before being pushed down the pecking order by Drake and eventually Walton.
Walton received six months of non-reporting probation as part of an August plea deal to resolve his three offseason court cases. Walton's probation was later vacated after he met the court's conditions.
Walton's attorney, Michael Gottlieb, said in August his client had his most significant charge of felony for carrying a concealed weapon from his March arrest reduced to a second-degree misdemeanor open-carry charge after pleading no contest. Walton was arrested after a car chase with police. The plea deal decreased the maximum of his jail sentence from five years to 60 days.
Walton also pleaded guilty to resisting arrest and reckless driving and had a misdemeanor marijuana charge dismissed in that same March incident. As a part of the deal, Walton also had a drug charge from a January incident and a battery charge from a February incident dismissed. He will also have to attend driving school after the reckless-driving plea. The Cincinnati Bengals released Walton, their 2018 fourth-round pick out of the University of Miami, in April following his three arrests.
The Dolphins signed Walton in May after a successful rookie minicamp tryout.
"The conduct of our players is very important and Mark has done everything we've asked of him both on and off the field since signing with the Dolphins. We look forward to having him back at the conclusion of his suspension," coach Brian Flores said in a statement.
Flores said then that "people deserve a second chance" and he doesn't "judge people based on one incident [or] two incidents. I think it's a case-by-case situation for a player and just people in general."
The Dolphins have praised Walton in recent weeks for his performance on the field, and the team expects him to return into significant action once he finishes his suspension.
Walton leads the Dolphins with 201 rushing yards on a 3.8 yards per carry average. He also has 15 receptions for 89 yards. Ballage has 35 carries for 70 yards and two touchdowns and four catches for 40 yards.