The Spaniard, who previously led Paris St-Germain to the French league title and won three Europa Leagues with Sevilla, was appointed Gunners boss in May 2018, succeeding Arsene Wenger.
He is to be replaced on a temporary basis by assistant and former Arsenal midfielder Freddie Ljungberg.
Arsenal said the decision had been “taken due to results and performances not being at the level required”.
The Gunners have not won in seven games and lost 2-1 at home to Eintracht Frankfurt in the Europa League on Thursday.
They are without a Premier League victory since 6 October and eight points off the top four.
In a statement, Arsenal added: “We have full confidence in Freddie to take us forward.
“The search for a new head coach is under way and we will make a further announcement when that process is complete.”
They finished fifth in 48-year-old Emery’s first season in charge at Emirates Stadium after he replaced Wenger.
The Gunners started this season with back-to-back victories against Newcastle and Burnley, but that run ended with defeat by Liverpool, before draws with north London rivals Tottenham and Watford followed.
Their last Premier League victory was a 1-0 win over Bournemouth.
On Saturday, they battled to a 2-2 draw – their sixth of the season – at home to Southampton, with Alexandre Lacazette scoring an injury-time equaliser.
Emery is the third managerial dismissal in the English top flight this season, after Javi Gracia and Mauricio Pochettino departed Watford and Tottenham respectively.
Arsenal’s last victory came against Vitoria Guimaraes in the Europa League on 24 October, in which they needed two late Nicolas Pepe free-kicks to secure a 3-2 win.
Culled from BBCSports