McCoist tendered his resignation on Monday following a 2-0 league loss at Queen of the South.
That triggered a 12-month notice period and a significant increase in McCoist's pay, although at the time the club said they would re-negotiate his salary.
The 52-year-old oversaw the 2-0 win over Livingston on Saturday, but his tenure has now finally come to an end.
A club statement released on Sunday said: "Rangers would like to announce that Ally McCoist is relinquishing his duties as manager and will serve out the remainder of his 12-month notice period on gardening leave.
"We would like to thank Ally for all his hard work and dedication over the last few years, but we feel it is now in the best interests of all parties to move on."
Assistant manager Kenny McDowall has been handed the job until the end of the season as Rangers seek a return to the top flight.
After Rangers were demoted to the bottom tier of the Scottish Football League due to financial irregularities, McCoist led the Glasgow club to consecutive promotions from League Two and League One.
However, the Ibrox outfit have struggled to adapt to life in the second tier and are nine points behind unbeaten leaders Hearts.
