Fifa announced that Chelsea will be unable to make any new signings until 2011.
Fifa handed the Blues the punishment after Lens made an complaint over the way Chelsea signed youngster Gael Kakuta in 2007.
The 18-year-old has also been banned from playing for the next four months.
“Chelsea will mount the strongest appeal possible following the decision of Fifa’s Dispute Resolution Chamber over Gael Kakuta,” read a statement on the club’s official website.
“The sanctions are without precedent to this level and totally disproportionate to the alleged offence and the financial penalty imposed.
“We cannot comment further until we receive the full written rationale for this extraordinary arbitrary decision.”