The club has also fired Lopetegui’s staff, including his assistant Pablo Sanz, head of performance Óscar Caro, chief analyst Juan Vicente Peinado, physical trainer Borja De Alba and technical trainer Edu Rubio.
“The board would like to thank Julen and his staff for their hard work during their time with the Hammers and we wish them every success in the future,” the club statement added.
“The process of appointing a replacement is underway.”
West Ham have also spoken to former AC Milan manager Paulo Fonseca and former Paris St-Germain manager Christophe Galtier, currently in charge of Saudi Pro-League club Al Duhail.
However, the belief on both sides is that Potter will get the job.
West Ham’s next game is the FA Cup third round at Aston Villa on Friday.
The Hammers’ 5-2 thrashing of Arsenal on November 30 and defeat to Leicester City three days later put Lopetegui under pressure.
They were unbeaten in their next four games, including wins over Wolves and Southampton, before a 5-0 home loss to league leaders Liverpool and Saturday’s loss to Manchester City.
It emerged earlier this week that the Hammers were considering sacking Lopetegui and had held talks with Potter about replacing him.
A press conference ahead of Friday’s FA Cup match against Aston Villa was canceled on Wednesday morning, before Lopetegui’s dismissal was announced.
West Ham reached the quarter-finals of the Europa League and finished ninth in the Premier League during Moyes’ final season at the club.
The previous season they had won the Europa Conference League, their first trophy in 23 years.
Former Spain and Real Madrid manager Lopetegui spent around £125m over the summer to improve his squad but had a disappointing start to the season.
Adding to their poor league form, the Hammers lost 5-1 to Liverpool in the third round of the Carabao Cup.
