The 52-year-old was successfully able to guide the Canaries to the Championship playoffs this season, a significant improvement on the 13th-placed finish in 2022-23.
However, Norwich missed out on reaching the final courtesy of a 4-0 aggregate defeat to Leeds United, losing by that margin at Elland Road in Thursday night's second leg.
Rather than opt for continuity under the German, the club's hierarchy have taken the decision to opt for a change in direction.
What have Norwich had to say?
In a statement on the club's official website, sporting director Ben Knapper has addressed the situation, praising Wagner for the "class" that he had shown in the role.
Knapper said: "David has operated with class and dignity throughout his period as Norwich City head coach, but we now feel that the time is right for us to move in a different direction.
"We remain committed to progressing our football club, in both the short and long-term, working through a diligent and thorough strategy.
"The appointment of a new head coach is an important one. We will now work and continue our due diligence with the view of making an appointment in the near future."
What was Wagner's record at Carrow Road?
Since his appointment in January 2023, Wagner was able to record 31 victories from his 75 matches in charge. However, there were also 27 defeats.
Had Norwich lost to Cardiff City ahead of the November international break, the East Anglian outfit would have likely sacked Wagner at that point.
Instead, Norwich won 3-2 in South Wales and proceeded to put together a run of 17 points from eight matches, subsequently keeping Wagner in a job.
Automatic promotion was never realistic at any point courtesy of the form of the top four, yet Norwich did not lose a single home fixture from November 5 onwards on their way to finishing sixth in the table.
That said, Norwich did fail to win any of their closing three regular fixtures, and losing heavily in Yorkshire on Thursday night marked the third successive game without a goal.