It's a mutual consent decision with chief executive Simon Clegg confirming that all parties had agreed that he should leave.
Owner Marcus Evans said: “Since he first walked through the door here, no one has worked harder to bring success to this Football Club than Paul Jewell. Unfortunately his outstanding commitment has not been rewarded by results on the pitch and having spoken with Paul at length, we feel it’s best for him and the Club if we go our separate ways.
“I’m bitterly disappointed, as is Paul, that it has not worked out as we had hoped when he became our manager 21 months ago and I would like to put on record my thanks for his services to the Club and wish him every success in the future.”
Paul Jewell said: “I could not have had any more support than I have done from Marcus Evans and Simon Clegg I have enjoyed working with both of them in my time as Ipswich Town manager.
“It’s been a privilege to be manager of such a fantastic football club and I want to thank the staff and the supporters for the backing they have given me in my time at the Club and wish Ipswich Town the best of fortunes ahead.”
This follows on from yesterday's news that Dougie Freedman had left Crystal Palace to move to Bolton, although Bolton are still to confirm anything, and takes the number of Championship clubs to have made a change this season to five, Blackburn and Burnley of course being the other two.