Girardi concluded a four-year, $16 million contract with the Yankees, who fell one win shy of advancing to the World Series this year -- losing Game 7 of the American League Championship Series to the Houston Astros.
After the Yankees lost in the ALCS, the 53-year-old Girardi said he would once again discuss his situation with his wife and three children.
"I want to thank Joe for his 10 years of hard work and service to this organization," Yankees senior vice president and general manager Brian Cashman said. "Everything this organization does is done with careful and thorough consideration, and we've decided to pursue alternatives for the managerial position.
"As Hal Steinbrenner (principal owner) and I mentioned to Joe directly this week, he has been a tremendous Yankee on the field and away from it, as a player, coach and manager. He has a tireless work ethic, and put his heart into every game he managed over the last decade. He should take great pride in our accomplishments during his tenure, and I wish Joe and his family nothing but success and happiness in the future."
Girardi took significant criticism for his team's loss in Game 2 of the ALDS versus the Cleveland Indians after failing to ask for a replay review on a strikeout that was incorrectly called a hit batsman.
Girardi managed the then-Florida Marlins for one year before taking over with the Yankees in 2008. He guided the club to the World Series title in 2009 and six playoff appearances.
Girardi owns an record of 910-710 with the Yankees. His win total ranks sixth in franchise history, trailing only Joe McCarthy (1,460), Joe Torre (1,173), Casey Stengel (1,149), Miller Huggins (1,067) and Ralph Houk (944).
As a catcher, Girardi played for 15 seasons with three World Series titles in four years as a member of the Yankees.