The club’s new Saudi Arabian owners had been expected to dismiss Bruce, who had become unpalatable to most fans, ahead of the weekend’s defeat to Tottenham – his 1,000th game in management – though he was kept in post for the first game under the new regime.
The 60-year-old spent just over two years in charge at his boyhood club, but failed to win over fans from the off having succeeded Rafael Benitez on Tyneside.
Bruce hit out at reporters and broadcasters for speculation around his future ahead of the Tottenham game but had made it clear in an interview with the Daily Telegraph following the takeover that he was expecting to be relieved of his duties.
The former Birmingham and Crystal Palace manager will receive a reported pay-off of £8million following the decision to appoint a new manager. Former Chelsea boss Frank Lampard is in the running to replace Bruce, as well as Eddie Howe and Paulo Fonseca.
Fonseca, who saw discussions to succeed Jose Mourinho at Tottenham collapse over the summer, is the early favourite with the bookmakers.
In a statement, Newcastle said: “Newcastle United can confirm that Steve Bruce has left his position as head coach by mutual consent.
“He leaves the Magpies after more than two years in charge, having steered the club to 13th and 12th-place finishes in the Premier League and reaching the quarter-final stage in both the Emirates FA Cup and Carabao Cup during his tenure.
“Newcastle United would like to place on record its gratitude to Steve for his contribution and wishes him well for the future.”
Newcastle fans turned on Bruce once again during the defeat to Tottenham on Sunday. Chants of “we want Brucey out” and “sacked in the morning” were directed at the manager from the home end.
Following his departure from St. James’ Park, Bruce said: “I am grateful to everyone connected with Newcastle United for the opportunity to manage this unique football club.
“I would like to thank my coaching team, the players and the support staff in particular for all their hard work. There have been highs and lows, but they have given everything even in difficult moments and should be proud of their efforts.
“This is a club with incredible support, and I hope the new owners can take it forward to where we all want it to be. I wish everyone the very best of luck for the rest of this season and beyond.”
The Magpies are currently just a point off the bottom of the Premier League table as one of three sides, along with Norwich and Burnley, yet to win a game this season.
Assistant manager Graeme Jones will take interim charge of Newcastle, starting with this weekend’s trip to Crystal Palace, before an appointment is made by the new board.
Bruce’s successor will step into a club with new-found spending power under the Saudi owners but will first face the daunting task of keeping a disjointed and under-performing squad in the Premier League.