Oak Park and River Forest High School will replace all 1,750 copies of the book over 'OK' gesture seen in photos "regardless of intent."
The yearbook was published in 1968 and lists State Senator Tommy Norment as its managing editor, according to The Virginian-Pilot.
Following an apology for the photo, Northam denied that he was in the photo at all: "I was not in that costume, either as blackface or KKK," he said.
A racist photo on Governor Ralph Northam's page in the memory book stirred outrage among both Democrats and Republicans, with both sides calling for him to resign.
Northam's popularity has fallen off a cliff.
The school chalked it up to an oversight issue.
A transgender Louisiana high school student who claimed her yearbook photos were pulled and she was barred from graduation for appearing "too feminine" was granted permission by the school district to have the pictures published.
"To a sweeter, more beautiful girl I could not say, 'Merry Christmas,'" he wrote.