Galtier had signed a two-year deal when he arrived at the Parc des Princes ahead of the 2022-23 season but despite guiding PSG to a record-breaking 11th Ligue 1 title, their failure in the Champions League came back to haunt him.
After the season ended, Galtier was also arrested for questioning as part of an investigation into alleged discrimination when he was at Nice following accusations by Julien Fournier, their former director of football.
"Paris St Germain and Christophe Galtier have decided to terminate his contract as first-team coach," PSG said in a statement.
"The club would like to pay tribute to his professionalism and commitment, which helped the Rouge & Bleu win a historic 11th French championship title"
PSG's ninth league title in 11 years did little to instil faith in the former Nice manager after their meek exit in Europe where they were knocked out by Bayern Munich, with the French side losing both legs in the last 16 without scoring.
While PSG were unbeaten in all competitions in the first half of the season, they lost 10 times since the turn of the year, even losing three in a row in February amid growing fan discontent.
A dip in performances from most players after the World Cup break and a bad run of form led to fans protesting outside injured forward Neymar's home while they also booed Argentine forward Lionel Messi in home games.
Galtier was also forced to navigate through the politics at the club after PSG suspended Messi for an unauthorised trip to Saudi Arabia a day after a 3-1 defeat at home by Lorient when he was supposed to be training with his team instead.
Galtier said the decision had nothing to do with him and he was only expected to comply with the club's ruling.
"I can't say it has been a pleasant period," he conceded at the time.
Messi eventually opted not to renew his contract and announced his intention to move to Major League Soccer side Inter Miami.
