Urlichich, the chief designer of the costly and scandal-plagued Glonass system of 24 navigation satellites, was fired Sunday by the Kremlin's military-industrial commission headed by Deputy Prime Minister Dmitry Rogozin, RIA Novosti reported.
The resignation came shortly after police accused unnamed Glonass officers of embezzling $200 million of $10 billion program's funds.
The moves targeting Russia's version of the Global Positioning System, built by Russian Space Systems, were coming in the broader context of a crackdown on corruption in the military-industrial sector led by President Vladimir Putin, under which the country's top military leadership has been reshuffled.
Both Defense Minister Anatoly Serdyukov and Chief of General Staff Nikolai Makarov were dismissed in the wake of a corruption scandal involving military contractor Oboronservice. Serdyukov had served the company's board chairman until last year, the Chinese news service Xinhua reported.
Sergei Ivanov, an ex-defense minister and ally of Rogozin, Sunday announced the resignation of Urlichich, under whose watch Glonass has been hit not only by alleged corruption schemes but also a series technical glitches and launch failures.
Money meant for upgrading Glonass was diverted into shell companies run by company managers in an alleged scheme that has been under a criminal investigation since 2010, Ivanov said.
The Glonass system cost $4.4 billion to build with $10 billion more budgeted for 2012-2020, RIA Novosti reported, adding no criminal charges against its designer or other company officials had been announced.
Russian Space Systems spokesman Alexander Zubakhin initially challenged the police crackdown on the Glonass program.
"Soon traffic police officers are going to be giving commentary on Russian Space Systems and Glonass," Zubakhin said last week of the alleged $200 million in missing funds. "The lower the rank of the commentator, the scarier the sum will be."
Zubakhin told Interfax Saturday he had "voluntarily resigned" from the contractor.
The news agency said First Deputy Prime Minister Vladislav Surkov appears to be leading the investigation and is determined to uproot corruption linked to the navigation satellite effort.
Putin spokesman Dmitry Peskov said Saturday that rather than signaling a sudden crackdown, the anti-corruption efforts targeting military contractors have been ongoing for years.
"Concrete steps to fight corruption are constantly being undertaken across Russia," he told Interfax.
This month's sacking of Serdyukov isn't merely a Kremlin-style replacing of leadership but part of wider effort by Putin to "purify" the entire authoritarian structure of the military-industrial complex, former Russian Prime Minister Yevgeny Primakov told Xinhua.
Igor Bunin, president of the Russian political think tank Center for Political Technologies, said Putin is also seeking to burnish his reputation amid declining popularity with the moves against Serdyukov and other members of the defense contracting establishment.
"Decisively removing tainted officials shows Putin's attitude towards corruption," Bunin told the news agency. "To cut the Gordian knot will earn more reputation for the president in the army and among the people."