Jim Phillips, Northwestern athletic director, summoned the team Saturday morning to deliver the news before making a public announcement.
The Wildcats failed to reach the NCAA tournament during Carmody's tenure and have never received a berth in school history. His team narrowly missed the tourney the previous three seasons, earning at least 19 wins each of those three years.
Carmody arrived in Evanston following a four-year stint at Princeton where he led the Tigers to the postseason each season, twice reaching the NCAA tournament. He did lead Northwestern to its first national ranking since 1969 when they were ranked No. 25 in the nation in December of 2009.
A loss to Iowa in the Big Ten tournament's first round this week capped a frustrating season, one in which they won only four conference games after losing three of their top players. Drew Crawford and Jared Swopshire both suffered season-ending injuries 10 and 24 games into the season, respectively. JerShon Cobb was hit with a year-long suspension last fall.
Northwestern remains the only team in a power-six conference to never appear in the NCAA tournament. According to ESPN, Duke associate head coach Chris Collins and Lehigh's Brett Reed are considered top candidates.
Carmody compiled a 190-220 record in his 13 seasons as head coach.