He will be replaced on an interim basis by Brian Graham, the team's director of player development.
Littlefield, 47, took the post July 31, 2001, and his teams went a combined 442-581 in his tenure, never approaching .500. That included 67-95 finishes in 2005 and 2006, and the current edition's 61-79 record.
His contract, which was extended on opening day last year, was to run through the 2008 season.
The firing was made by principal owner Bob Nutting, who already had been searching for a new CEO to replace outgoing Kevin McClatchy and now will add the general manager's post to that list.
"After eight months of listening and analyzing the situation, it has become clear that this decision was necessary to move our organization forward," Nutting said. "While there are many bright spots for us to build from, I am not satisfied with the overall performance and progress that has been made. I'm committed to building a successful organization, and this is an important step in that process."
Nutting previously had stated he would wait until after the season to decide the fates of Littlefield and manager Jim Tracy, whose contract also runs through 2008.
"I felt the time was right to announce my decision to ensure that the organization is in the best possible position to attract the very best general manager candidates," Nutting said. "In addition to allowing us more time to search for a replacement, it should allow more time for our new general manager to make the necessary evaluations and staffing decisions."
The firing of Littlefield will not affect the search for CEO, Nutting added. One person will be hired for each post.
"The search process for our new club president has clarified for me that the president and general manager positions are two distinct functions. I believe both individuals must have strong baseball backgrounds. The president will lead the overall day-to-day operations. It is clear, however, that most successful teams also have a strong general manager in place with a single-minded focus on leading the baseball operations."
Littlefield carried the additional title of senior vice president.
Nutting strongly suggested Graham will keep the post only on an interim basis.
"Brian brings years of industry experience and is a tremendous asset to our organization," Nutting said. "I'm confident he will be able to steer our baseball operations forward in the interim."
Graham, 47, has more than 26 years in professional baseball and six in his current post. He also was a major-league coach and, for nine seasons, a minor-league manager in the Cleveland Indians' system.
Littlefield accompanied the Pirates for their four-game series to St. Louis and, according to those close to him, had been behaving as if he were confident he would be back next year. The Pirates flew back to Pittsburgh last night after their 16-4 loss to the Cardinals at Busch Stadium, and Littlefield was notified of the decision at roughly 10 a.m.