"This was a difficult decision for the organization to make but we needed to make a change," President of Basketball Operations Joe Dumars said in a statement.
The Pistons are ninth in the Eastern Conference this season at 21-29, though they have won their past two games.
"Our record does not reflect our talent and we simply need a change," said Pistons owner Tom Gores.
"We have not made the kind of progress that we should have over the first half of the season. This is a young team and we knew there would be growing pains, but we can be patient only as long as there is progress."
Cheeks, 57, was appointed coach in June on a two-year deal.
An NBA point guard for 15 seasons, primarily with the Philadelphia 76ers where he was part of the 1983 championship-winning team, Cheeks previously served as head coach of the Portland Trail Blazers and 76ers.
"The leadership and player development qualities he brings as a former player and coach blends nicely with the roster we are building for the future," Dumars said at the time of the hiring.
"He's won an NBA championship, coached in two NBA Finals as an assistant coach and mentored some of the top young players in the NBA."
The honeymoon clearly did not last long.
Last Wednesday, Cheeks and point guard Will Bynum had a verbal altercation after the player was substituted for during the second period.
But Cheeks still evidently had some support in the locker room.
"I would like to thanks Mo Cheeks for everything," Pistons point guard Brandon Jennings tweeted on Sunday.
"Thank you for helping me become a better person & player. I'm still learning."
Cheeks leaves Detroit with a career record of 305-315 as a head coach.
Assistant John Loyer is expected to take over as interim head coach for Monday's home game against the powerful San Antonio Spurs.
"The responsibility does not fall squarely on any one individual, but right now this change is a necessary step toward turning this thing around," owner Gores said.
"I still have a lot of hope for this season and I expect our players to step up."