Moyes has been sacked less than one season into the six-year deal he signed on replacing Sir Alex Ferguson last summer.
United confirmed the news on their Twitter feed around 8:30am on Tuesday, although reports of his imminent exit had been circulating for almost 24 hours amid silence from the club.
A short statement thanked Moyes for "the hard work, honesty and integrity he brought to the role" during his 11 months in charge.
Ferguson's successor has overseen a slump from Premier League champions to seventh in the table, and United will not play Champions League football next season.
United are also guaranteed their lowest points total in the Premier League era, and Sunday's comprehensive defeat at Everton - the club Moyes left for Old Trafford - was a final humiliation.
Moyes took just six points from 12 games against the six teams above United in the table, but as recently as Sunday he appeared confident he would be given time and money to reshape the club's playing squad.
He did sanction deals worth more than £60m for Marouane Fellaini and Juan Mata, but the task of spending a summer transfer fund reported to be in the region of £150m will now fall to his successor.
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