The Argentine Football Association, facing an identity crisis in the national game, announced Batista had stepped down after his team were knocked out of the tournament in the quarter-finals nine days ago.
"The national teams commission has decided to rescind the contract," AFA spokesman Ernesto Cherquis Bialo said.
"Batista wasn't sacked," Cherquis Bialo said. "(Batista) put his future as the head of the national team up for consideration by the (AFA) executive committee."
Cherquis Bialo also said Argentina's friendly against Romania in Bucharest on August 10 had been cancelled.
"The coaching staff of Argentina teams at all levels are under evaluation by the national teams commission," he added.
"There are no deadlines, there´s no rush, no urgency (to name a new coach) so there will be a process of consideration and study."
National teams director Carlos Bilardo, who as coach steered Argentina to their second World Cup triumph in Mexico in 1986, has also come under scrutiny and risks losing his job.
There had been mounting media pressure for the AFA to make a decision to rescue Argentina from years of underachievement with Batista in the eye of the storm after AFA board members questioned his capacity for the job.
Batista, 48, had been in charge for a year, initially in an interim capacity after predecessor Diego Maradona was refused a new contract following Argentina's quarter-final elimination at the 2010 World Cup finals in South Africa.
His contract was to take him to the end of the South American qualifiers for the 2014 World Cup finals in Brazil with Batista vowing to build a team around Lionel Messi, the world's best player, to win the title.
Batista, nicknamed Checho, did not promise to deliver the Copa America but said it was Argentina's obligation as hosts to win the trophy and he was confident they would, having lost to Brazil in the previous two finals.
However, Argentina struggled against tough South American opponents also preparing for the World Cup qualifiers by building their teams from the back in contract to Batista's stated aim to play in the mould of European champions Barcelona, Messi's club.
His Argentina side had good results in friendlies with wins against world champions Spain, arch-rivals Brazil and Portugal but his competitive debut almost ended in a shock defeat by Bolivia who held them 1-1 in their Copa America opener.
Batista, holding midfielder in the 1986 World Cup-winning team, came into the senior job via the Olympic team he steered to Argentina's second successive football gold medal at the 2008 Beijing Games.
With South America's World Cup qualifiers kicking off in October, the AFA decided an overhaul critics said should have been made a year ago had to be done at once.
Argentina have gone 18 years without a major title since their last Copa America victory in 1993 and the youth programme led by former coach Nestor Pekerman that reaped five world U20 titles between 1995 and 2007 was dismantled.
Local media have made Alejandro Sabella, assistant to former Argentina boss Daniel Passarella at the 1998 World Cup and coach of the Estudiantes side that won the South American Copa Libertadores in 2009, favourite to take over.