Lynch, pictured after taking over at the Seagulls last October as the successor to Ashley Hoskin, left Llanelian Road with the Premier Division's strugglers nine points of adrift of safety and facing relegation in consecutive seasons.
In a statement announcing the departure of the 40-year-old former Southport player and Chesterfield coach after five months at the helm, officials said experienced midfielder and club captain Carl Rodgers and vice-captain Luke Denson had agreed to take temporary charge of first team affairs on Thursday night when the second from bottom Seagulls host Mickleover Sports in North Wales.
Colwyn Bay vice-chairman Kurtis Chapman said: “The board feel that despite all the changes Kevin has made to the squad, results have not improved since he came in. He has had plenty of time but a lot of the performances, particularly at home, have been well below the standard required.
“It is very disappointing because we thought Kevin would prove a good appointment and had been in talks with him about planning for next season but it has become clear for a while that things were not working.
“We hope that Bruno [Rodgers] and Luke [Denson] will now be able to foster the same spirit in the team that we had when Rob Hopley and Mike Lea were briefly in charge until a new manager is appointed."
He added: “We would ask the supporters to stick with us and give the team and the club all the support they can during this very difficult period.”
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