Local officials said President Macky Sall had asked Aminata Toure to stand down, after less than a year in office.
Aminata Toure’s Alliance for the Republic (APR) was defeated in key cities, according to preliminary results.
Discontent over economic policies contributed to the party’s poor results, correspondents say.
“She was sacked. She is no longer the prime minister,” a source close to the presidency told Reuters news agency.
The Senegalese Press Agency reported that Aminata Toure had left the government.
Her departure opens the way for President Macky Sall to try to speed up his reform process, aimed at creating more jobs.
In March 2012 election, Macky Sall defeated Abdoulaye Wade – who had been president for 12 years – promising to tackle poverty and corruption.
Senegal is seen as a beacon of democracy in West Africa and remains the region’s only country never to have had a military coup.
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