The Portuguese side have announced the departure of the coach after they slipped nine points behind league leaders Benfica
After winning only three of their last seven league matches, the Portuguese champions have dropped to third place and find themselves nine points behind leaders Benfica.
Fonseca's exit was announced on Wednesday, with the club confirming that Luis Castro, coach of the club's B side, will take over as interim boss.
Former Porto defender Fonseca promised to keep on fighting after the team suffered a first home league loss in more than five years at the hands of Estoril last month.
However, he was unable to turn things around, with his side mustering draws against Eintracht Frankfurt in the Uefa Europa League - in a tie that saw them progress on away goals - and Vitoria Guimaraes in the Primeira Liga on Sunday.