Fox, who led Carolina to their only Super Bowl appearance in 2004, has a 73-70 regular season record in nine seasons with the team but the Panthers are a league-worst 2-13 in 2010.
"I told John today that I appreciate everything he has done for us over the last nine years but ... it is time for both sides to move in different directions," Panthers owner Jerry Richardson said in a statement.
Fox, Carolina's most successful coach, will end his career with the team on Sunday when they conclude the regular season away to the Atlanta Falcons.
"I have formed many close relationships and I have many great memories. I particularly want to thank the players for their efforts throughout the years."
(Writing by Mark Lamport-Stokes in Los Angeles; editing by Frank Pingue)
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