The club said they wished Gary Bowyer well.
The 48-year-old arrived at Valley Parade last March, following the resignation of David Hopkin.
City’s interim chief executive, Julian Rhodes, said: "I would like to thank Gary for his efforts over the past year.
"He came to the club at a difficult time and inherited a team heading for relegation, which we were unable to avoid.
"Gary built a squad over the summer that has proven it is capable of competing at the right end of Sky Bet League Two.
"However, over the course of the last few months, results have undoubtedly declined.
"In view of recent events, we felt a change was necessary in order to compete for a play-off place.
"We would like to take this opportunity to wish Gary the very best for the future."
The club say they're now looking to appoint a new manager and further announcements will be made in due course.