The former Leeds United and Barnsley boss replaced Neil Lennon in February but was relieved of his duties in the wake of Saturday's 5-2 Betfred Cup semi-final defeat to Celtic, and with the team having not won in the Ladbrokes Premiership since the opening day.
The club have confirmed that Head of Player Development Eddie May will take charge on an interim basis, supported by assistant coach Grant Murray and Steven Whittaker.
Hibs' next match is against St Johnstone at McDiarmid Park on Saturday.
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