The firing was announced Friday, 15 minutes before a news conference to introduce new Diamondbacks general manager Dave Stewart.
"It was my trigger to pull," Chief Baseball Officer Tony La Russa said.
Bench coach Alan Trammell also was dismissed, but will stay on to manage the final three games, a weekend series against St. Louis.
"We just decided that being fresh, starting fresh with not just the upstairs leadership team but downstairs, is more consistent with what we are doing as an organization," La Russa said at the news conference.
Gibson took over as interim manager in 2010 when A.J. Hinch was fired, then got the job without the interim title. In 2011, his first full season, he led the Diamondbacks to the NL West title and was named major league manager of the year.
But his next two teams went 81-81, and this year, with a squad riddled with injuries, the Diamondbacks are assured at least a tie for the worst record in baseball. The Diamondbacks were 63-96 entering Friday night's game.
"I am extremely appreciative for this opportunity and I had a great experience with the Diamondbacks," Gibson said in a statement issued through the team. "I know we had a tough year and people will look at this as a negative, but we accomplished a lot of good things here. I told the team that I have nothing but the utmost respect for this organization and the people I've met along the way."
Gibson and Trammell were teammates on the 1984 Detroit Tigers team that won the franchise's most recent World Series.
La Russa called Trammell one of his favourite players and Gibson "one of the great competitors of our time."
"So it is really not a reflection on them," La Russa said. "I know that sounds a little hollow, but I'm always sincere when I am serious. The situation was unfair enough that the losses piled up, but we are making a fresh start. It made sense in the end to start fresh with the manager."
La Russa said Trammell was let go because he and Gibson "are so close."
Reliever Brad Ziegler, in his fourth season with Arizona, knows more changes are coming.
"There's going to be some player moves, too. It's not just coaching staff and front office changes," he said. "There's going to be some overhaul in the locker room, too."
Ziegler said the players are "all accountable for what we did on the field, and hopefully everybody can walk away from it knowing we did everything (we could). But going forward, there's no question they're going to demand more of us."
Arizona fired Kevin Towers as general manager earlier this month, but Towers stayed on to help La Russa while the GM search was completed. Towers was in the back of the room at the news conference, which mostly was dedicated to what Stewart and another newcomer, De Jon Watson, bring to the team.
"I'm looking forward to the day-to-day challenges of bringing a championship calibre team," Stewart said.
Watson, who came from the Dodgers organization, will hold a new position, senior vice-president, baseball operations. He will concentrate on scouting amateur and professional players.
Injuries were a big part of the problem this year.
All-Star first baseman Paul Goldschmidt had his season ended after four months by a broken hand after he was hit by a pitch from Pittsburgh reliever Ernesto Frieri.
Slugger Mark Trumbo, the team's key off-season acquisition, missed about two months because of a stress fracture in his left foot, and before the season, the Diamondbacks lost starter Patrick Corbin to Tommy John surgery.