An official statement by the club said: “We would like to thank Steven for his hard work and commitment and wish him well for the future."
The decision comes immediately after Villa's humbling 3-0 defeat to Fulham on Thursday night.
Gerrard leaves the club in 17th place on nine points, with the side's last win now over a month ago.
Villa have registered just two wins in the Premier League this season - against Southampton and Everton - and are slated to face Brentford this coming weekend.
Gerrard was appointed 11 months ago, guiding a wounded Villa to a 14th-placed finish last season.