Under his management, the Ochilview Park club have lost their last four matches and sit seventh in League 1, seven points behind Ayr United in fourth and only eight above Arbroath in the second-bottom spot.
"It is with great regret that Stenhousemuir Football Club must announce that the club and the manager, Martyn Corrigan, have agreed to part company," a statement said.
"We would like to express our thanks and gratitude to Martyn for all his efforts over the last two seasons. We all sincerely wish him the very best for the future.
"A further announcement will be made in due course regarding a successor."