The former Ireland international joined Leicester's coaching staff in 2008 after ending his playing career at Welford Road.
The Tigers have endured a difficult start to the new season, with three defeats from six matches leaving them in eighth place in the table.
"Paul has been a good servant to the club and was very much liked by players and staff, first as an experienced member of the squad and then as part of the coaching team, initially under Heyneke Meyer and then Richard Cockerill," executive chairman Peter Tom told Leicester's official website.
"We are grateful for Paul's hard work on behalf of the club over the last eight-and-a-half years, and we wish him well for the future."
Leicester are next in action on Saturday when they travel to London Irish in the LV= Cup.