The dismissal has potentially paved the way for Liverpool legend Steven Gerrard to take over at Ibrox, although the club has been careful not to ignite any further speculation about Murty's replacement.
"Graeme Murty has this morning been relieved of his duties as manager of Rangers," a club statement read.
"Jimmy Nicholl and Jonatan Johansson will take charge of the team for the three remaining matches of the season."
Rangers looked all at sea in the derby at the weekend, a match that saw Celtic claim a seventh straight Scottish Professional Football League title off the back of the emphatic result.
"Rangers are grateful to Graeme, who did not hesitate when asked last October to become interim manager after the departure of Pedro Caixinha and then, at the turn of the year, when he was offered the role as manager until the end of the season," Rangers' statement continued.
"Graeme has had to contend with difficult and challenging circumstances but conducted himself in a thoroughly professional manner. He will take some time to consider his options, which include returning to his role at the Rangers Academy.
"Jimmy Nicholl and Jonatan Johansson have already started preparing the team for the match against Kilmarnock on Saturday [Sunday AEST] and they will be in place for the two remaining fixtures, against Aberdeen and Hibernian.
"The club hopes to be in a position to comment further on the managerial situation in the near future."