Los Che have dispensed with the services of the 47-year-old following a poor start to the season, with the Mestalla outfit currently ninth in La Liga.
The Serbian trainer took over the reins at the Mestalla outfit in the summer following Ernesto Valverde's dismissal but has suffered an indifferent start to the season, with los Che currently sitting ninth in the Liga table.
And Sunday's 3-0 loss in the Spanish captial proved to be the final straw, with the club confirming his sacking at a press conference on Monday.
"The motive of this press conference is to announce on behalf of the Valencia board of directors the unanimous termination of Miroslav Djukic's contract," presdient Amadeo Salvo said. "It's a tough day for everyone. After a start where had a lot of confidence, we are not in a postiive place, but football has these kinds of situations."
Meanwhile, youth coach Nico Estevez has been placed in charge of the first team until a long-term replacement is announced.