MacDonald, 52, who only took over in March from Paolo Di Canio, missed Friday night's pre-season friendly at Forest Green, with doubts over his future arising amid reports he had offered his resignation.
The Robins stressed MacDonald missed the game for "personal reasons" but have now moved to clarify the situation and also announced assistant manager Mark Cooper will take temporary charge.
A statement on the club's official website read: "Swindon Town Football Club can confirm that after further meetings with the board of directors today (Saturday), Kevin MacDonald has left his position as first-team manager by mutual consent.
"The club would like to thank Kevin for all his hard work during his time at Swindon Town and wish him all the best for the future.
"Kevin would also like to thank the directors, staff, players and supporters for the backing and support they have given him over the last few months.
"The process to find a replacement for Kevin will begin immediately and Mark Cooper will be placed in temporary charge of the team until that process is complete."