McElroy, who was the Jets' third string quarterback behind Sanchez and backup Tim Tebow, will start against the San Diego Chargers on Sunday in New York's penultimate game of the season.
The decision came on the heels of Sanchez's error-riddled performance in Monday's 14-10 loss to the Tennessee Titans that eliminated the Jets from the play-off hunt.
"After thinking about it, about where the team is now, I think it's best for our team and for this game," Ryan said. "That's what I feel in my gut.
Despite throwing four interceptions on Monday, Sanchez had a chance to leave Nashville with a win on Monday when the Jets took possession on the Titans' 25-yard line with under a minute to play. But the fourth-year quarterback fumbled a snap that Tennessee recovered before running out the clock.
It was the last straw for Ryan, who watched his quarterbacks sputter much of the season with neither Sanchez nor Tebow able to generate any consistent offense.
With two games remaining, Ryan did not rule out Sanchez playing before the end of the regular season but refused to speculate on Sanchez's long-term future with the team.
Once the toast of New York who led the Jets to the AFC championship game his first two seasons, Sanchez has quickly fallen out of favour with Jets fans, who have placed most of the blame for the team's struggles on his shoulders.
He leads the league with 24 turnovers this season and has had an NFL-high 50 over the past two seasons.
"People can speculate anything they want," said Ryan. "Obviously, as a football team we're 6-8 and nobody's happy about that."