He signed a contract extension in January to remain in charge of the Galician outfit until the end of next season but the team won only two of their last 21 league games.
"Deportivo has taken the decision to terminate the contract of Victor Sanchez del Amo," the club said in a statement on Monday.
"The club wishes to thank the coach for his effort, dedication and professionalism during his time in charge of the team."
The former Deportivo player and Spain international replaced Victor Fernandez in April 2015 and helped the club avoid relegation last season.
(Writing by Adriana Garcia; Editing by Tony Jimenez)
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