Nir Klinger quit as coach of Maccabi Tel Aviv on Monday, a day after the team lost, falling 17 points below league leader Maccabi Haifa.
The 3-2 defeat to archrival Betar Jerusalem on Sunday was Klinger's last match after 3 1/2 years.
"I would like to announce my immediate resignation as Maccabi Tel Aviv's coach, a decision which I have been pondering over the past weeks," Klinger said in a statement posted on the team's Web site.
Despite signing some big names for this season, Maccabi Tel Aviv is fifth in the league.
Klinger, 39, who captained the team in the early 90s in winning three league championships and two state cups, is replaced by former teammate and club vice president Eli Driks as interim coach.
Yitzhak Schum, a former player and ex-coach of Greek club Panathinaikos, is a candidate to replace Klinger long-term.