"Pochettino will cease with immediate effect as the manager of the first team," the Barcelona-based club said in a statement. "This afternoon, both the club and Pochettino have mutually agreed to terminate their contract."
The 40-year-old former Argentina international took the helm in January 2009 and won plaudits for his work in bringing through youngsters from the academy as the club were forced to sell their best players year after year.
A 2-0 home defeat by Getafe on Sunday was the final straw.
"I have been in the world of football for many years and understand that a coach has a sell-by date," Pochettino, a popular former player at the club, told a news conference.
"When you have bad results it is normal that the coach goes. We have taken a responsible decision thinking that the change is positive. I have waived the final year of my contract.
"I will always be available for the club if needed in the future."
Former Mexico boss Javier Aguirre, who has had extensive La Liga experience with Osasuna, Atletico Madrid and Real Zaragoza, was being linked with the job in the Spanish media.