The Brewers share the NL wild-card lead with Philadelphia despite losing 11 of 14 in September, including seven of their last eight. Milwaukee was idle Monday.
"This was a very difficult move to make, and we appreciate all of the work that Ned has done to develop this team into a contender," general manager Doug Melvin said. "In the end, this was a collaborative decision made to put our club in the best position for the final two weeks of the season."
Milwaukee is hoping to avoid a repeat of last year's collapse. The Brewers held an 8½-game lead in late June before sliding to 83-79 and missing the playoffs.
The Brewers kept up their playoff push even longer this season, boosted when they made a big splash on July 7 by getting ace CC Sabathia from Cleveland.
Sabathia, the reigning AL Cy Young winner, is 9-0 in 13 starts with six complete games and a 1.59 ERA.
Yost was in his sixth season as the Brewers' manager. When Milwaukee hired him from Atlanta after the 2002 season, the team was in the midst of four straight seasons with 94 losses or more.
But the next three seasons resulted in records of 81-81, 75-87 and 83-79, a marked improvement for a franchise that hadn't had a winning record since 1992.
Yost spent 12 years on the Braves' coaching staff with Bobby Cox, and Atlanta won division titles every year Yost was there except the strike-shortened 1994 season.