Newcastle United coach Peter Beardsley "is no longer employed by the club", the Premier League side say, reports BBC Sport.
Beardsley has been on leave since an investigation into racism and bullying allegations was launched last year.
The 58-year-old, who had been under-23s coach at Newcastle since 2009, had "categorically denied the allegations".
The former England international, who made 326 appearances for Newcastle as a player, said the "time was right to seek a new challenge".
Newcastle added it was "grateful for the contribution Peter has given over the years as a player, coach and ambassador and we wish him well for the future".