"I could not fault either his commitment or effort to the cause but the last few weeks have been the most disappointing during my tenure within the game.
"My energies will now be fully focused on getting the right man, firstly to stop the decline we have suffered in the last few years, and secondly, to take us forward in the future with that level of stability which we all crave."
Leicester have gone through six managers in the past year, with Holloway himself spending £2m in the January transfer window.
I gave 100% to the cause but unfortunately we ran out of time
But despite bringing in the likes of Steve Howard and Barry Hayles, Leicester were still consigned to relegation.
And dropping into League One, the first time that Leicester have been relegated to the third tier of English football, ultimately cost Holloway his job.
"Leicester City is a marvellous club and I am as devastated as anybody that this great club suffered relegation," said Holloway.
"I gave 100% to the cause but unfortunately we ran out of time.
"The fans here are a different class and deserve a lot, lot better.
"I'd like to wish everyone connected with Leicester City well for the future - the club will always remain close to my heart."
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