Nicol leaves the Revs after 10 seasons in charge of the club and with a record of 112-108-81, ranking second in Major League Soccer in overall career games coached (301) and fourth in wins.
"Robert and I met with Stevie today and we had a productive discussion about this past season and the direction the club needs to go in the future," said Jonathan Kraft. "We all agreed a change of direction was needed to reverse the trend of the past couple of years. Stevie was a successful head coach and a tremendous ambassador for the Revolution for the past decade and set a high standard for success, leading us to four conference titles in six years. We thank him for all of his contributions."
Under Nicol, New England reached the conference finals in six successive seasons from 2002-07 and advanced to four MLS Cup finals.
He also guided the Revs to the 2007 U.S. Open Cup title and the 2008 SuperLiga, making New England the only team from MLS to win the competition.
However, Nicol has failed to lead the Revs to the postseason in each of the last two campaigns.
"I'm very thankful to the Krafts for giving me the opportunity to be their head coach," Nicol said. "I've had some great times and been involved with some great players and great people. My family will always remain part of the Kraft family."