Freshfields Bruckhaus Deringer said it has stopped using the phrase from this weekend.
In the UK, the firm will now address all communications to "Dear Sir or Madam", while in the US all correspondence will start with "Dear Ladies and Gentlemen".
Equivalents in Cantonese, Mandarin and European languages have also been agreed across Freshfields' global network.
"It is a relatively small change, but it is a significant point and you notice that when everyone immediately accepts that the change needs to happen." Freshfields' joint managing partner Chris Pugh told The Observer.
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The firm implemented the change after one of its London associates researched legal documents from the last 10 initial public offerings of private company shares.
It found 81 law firms and banks exclusively used "Dear Sirs" on letters and communications during the process.
Sam Smethers, chief executive of the Fawcett Society, the UK's largest charity for women's rights, said the change was long overdue.
"We have to think about the language we use as it reveals the assumptions and decisions being made. Even Parliament continues to use 'he' in legislation, the assumption being that will refer to everyone. We should be looking at gender neutral language for our legislation too," Smethers added.
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