Shrewsbury Town have placed assistant manager John McMahon in caretaker charge of first-team affairs after parting company with Gary Peters.
The Shrews board decided that Saturday's 4-1 defeat to Barnet - a result that left the club 16th in the League Two table and only ten points above the relegation zone - was the final straw.
Peters told Town's official website: "The negativity towards me at the moment might be affecting the team and whatever we can do for us to get results we need to do.
"If that's by me leaving the club then that's what needs to be as I don't want that negativity to get to the players.
"The results that we've had over the last 12 games haven't been good enough and I wouldn't have been surprised if I'd been sacked.
"That hasn't been the case and it's been a mutual agreement between the chairman and myself that I've decided to leave Shrewsbury Town."
The 53-year-old former Preston North End and Exeter City manager had been in charge of the Shrews since November 2004 and guided the club to the League Two play-off final last season.