Kenya were knocked out of the tournament, for teams made up only of African-based players, on penalties on August 4 after both legs of their first-round tie with neighbours and arch-rivals Tanzania ended goalless.
Frenchman Migne took charge of the Harambee Stars in May 2018 and steered the side to a first African Cup of Nations finals appearance in 15 years.
Hampered by injuries to key players, Kenya were eliminated at the group stage despite beating Tanzania, 3-2.
“Football Kenya Federation and Harambee Stars head coach Sebastian Migne have agreed to terminate the coach’s contract on mutual consent” said Barry Otieno, the federation’s acting general secretary.
“Consequently, FKF and Migne have agreed on a settlement for the coach, over a period of time.”
Otieno said the reorganisation and appointment for a new coaching team was already underway.
Kenya play Egypt in the preliminary round of the 2021 Africa Cup of Nations in Cairo in November.
