It had been reported McCall, who threatened to quit last summer after City failed to secure a play-off spot, would have left the club the previous weekend had his side not snatched three points at Torquay with two late goals.
McCall, who had 18 months left to run on his contract and was installed as manager in May 2007, enjoyed two successful spells at the club as a player spanning 12 years before taking over as manager after the Bantams had been relegated from League One.
The 45-year-old former Scotland international captained the Bantams to promotion to the Premier league in 1999.
A club statement said: "Stuart McCall has today left his post as manager of Bradford City.
"The decision was felt to be in the best interests of all parties following a run of disappointing results that have left the club in 16th place in the League Two table.
"The club would like to place on record its appreciation for Stuart's efforts as manager over the past two years and seven months.
"During this time he has worked tirelessly and no one is more disappointed that his endeavours have not been rewarded with more success on the field than Stuart himself.
"Stuart will always have a special place in the hearts of our fans for the dedication and passion he has consistently shown to Bradford City, starting with two highly successful spells as a player with the club.
"No one could have anticipated the overwhelming response to the season ticket campaign of 2007/2008.
"This great achievement illustrated the huge regard Stuart is held in by everyone connected with the club. His place in some of the most memorable times in the club's history is assured."
The club confirmed McCall, whose previous clubs as a player include Everton, Rangers and Sheffield United, accepted a settlement "by no means as much as he could have been entitled to".
The statement added: "The club will now seek to appoint a new manager to help us to achieve this ambition and reward the loyalty of the fans, including the 6,800 who have already purchased season tickets for the 2010/2011 campaign."
Bradford 8/11, Draw 5/2, Grimsby 4/1