The Tykes sacked Hill after their 3-1 home defeat to Blackburn sent the club to the bottom of the npower Championship table.
Hill, 43, has come under increasing pressure in recent weeks and earned a stay of execution following his side's win at Millwall, but the Tykes slumped to a seventh home league defeat of the season.
Barnsley are now searching for their fourth manager in three-and-a-half years following the departure of former Blackburn defender Hill, who replaced previous boss Mark Robins in June 2011.
Hill was sacked by Rowing straight after the game and he said: "Keith and his assistant Dave Flitcroft have given their all to the club and played some attractive football.
"Keith was very disappointed but this was a decision made by the board and not by one man. It is a very sad day.
"We thank Keith for the hard work he has put in, but we have not won at home since we beat Bristol City in September and the fans have become restless and they look to us to make the decisions.
"The results haven't gone our way and he has paid for it."
Rowing refused to say who would be in charge of the team for the New Year's Day visit to Peterborough.
It is understood Flitcroft has been asked to do so, but has not yet given the club his decision.
- Sports & Recreation