Die Wolfe have endured a torrid start to the season, picking up just five points from eight games, and the board felt the need for change to try and avoid a relegation battle
The Radkappen lie bottom of the Bundesliga table and after four consecutive league losses, chairman Dr Francisco Garcia-Sanz has decided to look elsewhere.
Lorenz-Gunther Kostner will be in temporary charge of the team until a suitable replacement is found to take the helm at the Volkswagen Arena.
"We want to express our thanks to Felix Magath explicitly," an official statement on the club's website reads.
"He has during his two terms with Wolfsburg showed tremendous commitment and great achievement for our club, the city of Wolfsburg and the sport in the region."
"The focus now is on the upcoming games, and to as soon as possible progress to the middle of the league."