The 59-year-old, who only joined the Albiceleste in August last year, has overseen just three wins from the eight games he has been in charge, losing three of the last five to leave the side out of the automatic qualification spots for the 2018 World Cup.
After initially being backed by Argentine Football Association (AFA) president Claudio Tapia, the latest result – a 2-0 defeat to Bolivia – was the last straw.
"We told Bauza that he is no longer the coach of the national team," Tapia told reporters on Monday.
Argentina next face fierce rivals Brazil in a friendly scheduled for June, followed by a crucial World Cup qualifier against Uruguay in August.
Argentina sit fifth on the qualification table, a point behind Chile who lie in the final automatic qualification berth.