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Kinnear, 67, had come under fire after Newcastle, who were thrashed 3-0 at home by local rivals Sunderland in the league on Saturday, did not buy any new players in the January transfer window and lost playmaker Yohan Cabaye to Paris St Germain.
"Newcastle United can confirm that Joe Kinnear has this evening resigned from his position as director of football with immediate effect," the north-east club said in a statement on their official website.
Kinnear was responsible for attracting talent to the club but strikers Luuk de Jong and Loic Remy, on loan from Borussia Moenchengladbach and Queens Park Rangers respectively, were the only players added to the first-team squad under his watch.
Newcastle, who lie mid-table in the league, failed to sign Clement Grenier from Lyon as a replacement for Cabaye, who left for a fee that could reach 25 million euros.
After the Sunderland defeat, manager Alan Pardew said: "If I was in charge, solely, of transfers, things might be different, but I'm not. I think I've made my opinions very clear this week and all the rest of it is confidential."
The chorus of disapproval over Kinnea reached a deafening volume last week as, having not made a single permanent signing during the summer transfer window, he oversaw the sale of Cabaye - a player he had at one point referred to as "Yohan Kebab" - to Paris St-Germain.
But with Pardew, who had not wanted to lose the Frenchman, insisting the club had to replace their playmaker if they were to stand any chance of maintaining or improving upon their current standing of eighth, they were unable to push home their interest in either Lyon's Clement Grenier or Montpellier's Remy Cabella.
Hours after the transfer window closed, Newcastle were trounced 3-0 by arch-rivals Sunderland on their own pitch for the second successive season and Shearer believes a combination of all those factors could well have led to the former Wimbledon manager's resignation.
The club's difficulties in the January transfer window were the latest twist in Kinnear's difficult relationship with the fans, who never warmed to the outspoken Irishman.
He returned to Newcastle, where he was manager for four months in the 2008-09 season before his tenure was ended by a heart attack, in controversial circumstances.
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Premier League - Kinnear resigns from Newcastle post
Transfer Specials. Click here to bet.
But which teams made the best - and worst - use of the 31-day opportunity to fill holes and fix problems in their squad?
Our Tom McDermott looks at the winners and losers of the transfer window from teams chasing Europe or looking to avoid the drop.
WINNERS
Chelsea
It was a very busy January transfer window for Jose Mourinho and Chelsea.
The club said goodbye to fans favourite Juan Mata but with the arrival of Nemanja Matic, Mohamed Salah, Bertrand Traore and Kurt Zouma, we got a glimpse of what the future may hold at Stamford Bridge under the Portuguese.
Mourinho would love to win the Champions League with Chelsea and by signing some of Europe's most exciting young players it looks like he thinks that is the best way of doing it.
The London club may not pip City to the title this season, despite their 1-0 win at the Etihad Stadium, but by signing such players in January it's clear Mourinho plans on building a side that will be successful at home and abroad for many years.
The former Inter Milan manager returned to the club in the summer and you wouldn't bet against some of his latest additions helping him achieve greater success in the near future.
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January window winners & losers
Finding energy-efficient windows has become easier, as insulating features such as heat-reflecting low-E coatings and argon gas between panes have become more standard. You'll also find new options and extras, including fiberglass window frames. Use this buying guide to make your selection.
"Stop throwing money out your old windows," some commercials say. With heating costs on the rise, many homeowners may wonder whether it's time to replace aging, drafty windows with efficient, tight-fitting ones.
In addition to reducing your energy bill, new windows can make your home more comfortable, quiet, and attractive. But don't expect to recoup your investment right away. If you now have old-fashioned single-glazed windows, replacement windows might save you from 10 percent to 25 percent a year for heating and cooling. But new windows cost from $7,000 to $20,000 for an average house, and custom sizes can add another 15 percent. So it might take 20 years or more before you break even. That's why you might want to wait until your old windows have deteriorated, when you're remodeling, or when you want windows that are easier to wash and maintain.
Replacement windows have become more energy efficient since insulating features such as multiple glazing, Low-E coatings, and inert-gas insulation have proliferated in many manufacturers' lines. We tested replacement windows for air and water leakage, durability, and convenience. Here's what we found.
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Consumer Reports - Replacement Windows
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