"We parted company with Ilian Iliev," Levski's chief executive Ivo Tonev said at the Georgi Asparuhov stadium on Friday. "We had a conversation with him and (sporting director Daniel) Borimirov and we reached an agreement."
Levski, chasing their 27th league title, have failed to win in four of their last five league games but are still second in the standings with 46 points from 21 matches, two points behind champions Ludogorets.
Last month, former Levski midfielder Iliev, 44, offered to quit after the goalless home draw against bottom club Montana with fans calling for his departure following a series of inept performances.
The club, however, refused to accept the resignation of the coach who led Beroe Stara Zagora to the Bulgarian Cup in 2010, and won three league titles as well as two national cups as a Levski player in the early 1990s.
Frustrated Levski fans set up a roadblock and tried to storm the club bus on the trip back to Sofia after a 1-1 draw at Pirin Gotse Delchev on Wednesday with 20 arrests being made.
A day later, supporters, disgusted by recent displays, have demanded in a statement the club field a junior team to complete the season instead of "players who have nothing to do with the ideals, the cause and meaning of Levski".
Former Levski winger and academy coach Mitov will be assisted by former Bulgaria internationals Elin Topuzakov and Marian Hristov.
"Elin was a team captain during Levski's best period while Marian (also a former Levski player) won the German league title with Kaiserslautern," Tonev said. "They know how to win the title and our players need such a winning mentality."
The 40-year-old Mitov, who becomes Levski's 11th coach in the last five years, knows the pressure will be on him in guiding The Blues to their first league title since 2009 as he will have to deal with hugely demanding and impatient fan base.
Mitov will make his debut on Saturday when Levski host city rivals Lokomotiv with the two also meeting on Wednesday in a Bulgarian Cup semi-final, first leg tie.