British media reported this month that Kirk was under investigation for an alleged relationship with a player.
"Following an extensive internal disciplinary process and respecting the club's obligations to individual privacy, Willie was determined to have breached the team's code of conduct to a degree that makes his position untenable," Leicester said.
Kirk had been City manager since November 2022 after a brief spell as their director of football.
Assistant manager Jennifer Foster will take charge of the team as the club prepare to appoint a permanent manager.
Leicester, ninth in the WSL standings, travel to Aston Villa on Saturday.