The Dutchman was informed of the decision by the club's board on Monday morning, fewer than 24 hours after the club's defeat by West Ham at the London Stadium on Sunday afternoon.
Ruud van Nistelrooy, who joined the club as Ten Hag's assistant last summer, has been named as interim manager.
United's 2-1 defeat at West Ham left the club 14th in the Premier League with just three wins from their opening nine matches, while they are 21st of 36 teams in the Europa League table.
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