Steve Bates insists he is proud of Newcastle's achievements this season despite having his contract terminated as Falcons rugby director.
Former Scotland and Lions back Alan Tait will take the reins as head coach following Bates' exit that came after a boardroom review at the Guinness Premiership club.
Bates said: "I am disappointed at the outcome of this review, but I am proud of what has been achieved this season in a very competitive environment.
"I would like to thank the players and all of the back-up staff for their support and effort.
"I would also like to thank my wife and family for their fantastic support, loyalty and encouragement during this time."
Newcastle are currently 10th in the Premiership with one game left, and they were Amlin Challenge Cup quarter-finalists before being crushed at home by Cardiff Blues.
Falcons chairman Dave Thompson said: "With immediate effect, first team coach Alan Tait will now take charge as head coach, reporting into chief executive David Bell.
"Alan will be undertaking a review of the playing, coaching and support structure, and announcements relating to that review are expected shortly.
"We would all like to express our thanks to Steve for his contribution during his time as director of rugby, and wish him every success in the future."
Tait won 27 caps for Scotland and also worked in the national team coaching set-up as a defence specialist.
He was part of Newcastle's 1998 Premiership title-winning squad, and played in two Tests for the British and Irish Lions on their successful 1997 tour to South Africa, scoring a try in the memorable first Test victory.
And Tait also enjoyed a successful rugby league career, playing for Widnes and Leeds, in addition to making 16 Great Britain Test appearances.
Newcastle have yet to announce any major new signings for next season, but among those players leaving Kingston Park are All Blacks prop Carl Hayman, who will link up with former Falcons fly-half Jonny Wilkinson at Toulon, wing Tom Biggs and young fly-half prospect Rob Miller.
Apart from Wilkinson, Bates' reign also saw high-profile players like Toby Flood, Jamie Noon and Tom May depart the Falcons.
And Tait now faces a busy summer of preparation, planning and probable recruitment if Newcastle are not to begin next season among the clubs tipped for relegation.