The Japan Football Association announced Monday it has terminated its contract with Halilhodzic and appointed former Gamba Osaka coach and the association's technical director Akira Nishino for the job.
Nishino, who earned 12 caps for Japan as a player, has previously managed the Samurai Blue at youth level, including their under-23s at the 1996 Olympics, in which he oversaw a 1-0 win against a Brazil side containing Ronaldo, Roberto Carlos and Rivaldo.
At a news conference in Tokyo, JFA President Kozo Tashima cited as a major reason the recent disappointing results of friendlies that were preparing the Japanese national team for the Russia World Cup, in which it will face Colombia, Senegal and Poland.
"We have asked Nishino to take this position as an emergency measure". "It's all about results in this game".
The straight-talking Halilhodzic has made few concessions in Japan's famously polite society, and his style reportedly stirred tensions between the coach and the dressing room.
In 2016, as Japan struggled to qualify for the World Cup, he told AFP he felt his players were too respectful.
"We came to this decision because I thought this could increase the chances of the team winning - even if it's just by a little", Tashima said.
"No progress, no hope, lots of worries over the World Cup", blared a headline in the Sports Nippon last month, raising the prospect that Japan might lose all its group games in June.
Comments made by the manager in the wake of the defeat, as quoted by the Japan Times, brought him in for more heavy criticism: "I was amazed by South Korea's explosiveness of power, technique and control of the game".
Halilhodzic, who recovered from being wounded in 1992 during the Bosnian war, insisted he was no "dictator" - but acknowledged his frank approach was capable of "wounding" some people in Japan.
However, it was not a smooth path through to the finals.
The Franco-Bosnian was one of the managerial successes of the 2014 World Cup as he guided surprise-package Algeria beyond the group stages with a series of impressive performances.