The Scot has been shown the door almost a year to the day of his appointment at the San Sebastian club.
He had enjoyed a promising start to his reign but the team have struggled this season, winning just two of their 11 La Liga games.
Friday night's defeat to lowly Las Palmas proved to be the final straw for Sociedad's president Jokin Aperribay.
He returned to Spain on Monday and is understood to have met Aperribay for talks before his departure was officially confirmed.
A Sociedad statement read: "Real Sociedad has taken the decision to rescind the contract of first team coach David Moyes. His assistant, Billy McKinlay, has also been relieved from his position at the club.
"Real Sociedad would like to thank David Moyes and Billy McKinlay for the professional conduct, commitment and dedication which they showed during their roles in the running of the first team; at the same time, we would like to wish them all the best in their future ventures, both professional and personal."
Moyes had been hoping to rebuild his reputation at Real Sociedad after a disastrous spell in charge of Manchester United.
The 52-year-old was axed by United in April 2014, just ten months into a six-year contract.
He previously enjoyed 11 years at Everton, where he had established himself as one of the Premier League's most respected bosses.
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