The south coast club, who drew with Manchester United in the Premier League on Saturday, are 18th in the table.
Southampton confirmed this in a statement on Monday, adding: “The search for a new manager to take the club forward is already underway.”
First-team assistant coach Kelvin Davis will take charge of the team for the game against Tottenham on Wednesday.
Hughes, who also had a spell at the south coast club during his playing career, joined Southampton in March, two months after being sacked by Stoke City.
The club were one point above the relegation zone at the time and the 55-year-old led them to safety last season by securing two wins from their last four games.
However, they have struggled again this season and, across his spell, have won just three of their 22 league games.