Martelli joined the program in 1985 as an assistant under Jim Boyle and John Griffin before being promoted to head coach in 1995.
The school will immediately start searching for the 64-year-old's replacement and intends to hire someone in the "coming weeks."
The Hawks haven't finished above .500 since 2015-16, which coincides with their last NCAA Tournament appearance. Over the past three seasons, they went 41-55.
Under Martelli's leadership, Saint Joseph's produced multiple strong seasons, including an Elite Eight appearance in 2004. The Hawks completed that season with a 30-2 record behind the play of eventual NBA starters Jameer Nelson and Delonte West.
As a head coach, Martelli reached the Big Dance seven times in his 24 seasons and the program finished in the AP's Top 25 three times. However, the Hawks haven't been ranked in the poll since 2004.