The former Milan and Napoli coach was appointed ahead of the 2022-2023 season after a year out of the game.
But Gattuso has been unable to inspire Valencia, which finished ninth last season.
Gattuso leaves the club in 14th place, winless in four outings since the World Cup break and just a point above the bottom three – albeit with a game in hand over the other sides in the bottom half.
After the last-gasp defeat to Real Valladolid – his final match at the helm – Gattuso addressed supporters and told them Valencia's poor results were his responsibility.
The 45 year-old also angrily confronted the assembled media a day before Valencia announced his exit.
"Valencia CF announce that this Monday, January 30th, the club and the first team coach, Gennaro Gattuso, have decided by mutual agreement to end the contractual relationship between the two parties," a statement read.
"The club wish to thank Gattuso for his commitment and work during his time in charge and wish him the best of luck for the future.
"The team will return to training this Tuesday, January 31st, under 'Voro' Gonzalez."
Voro, who is set to take charge of the team at Real Madrid on Thursday, is in his seventh spell as interim coach, having also led Los Che on a permanent basis in the second half of the 2016-17 campaign.