Terenzi led the Hornets to 129 wins in her nine seasons as the squad's head coach with the team advancing to the ODAC Tournament in 2012, 2013, 2014 and 2015.
Her best season at the helm of the program came in 2015 with SU finishing fifth in the ODAC at 18-10 overall and 7-4 in the league.
In the last three seasons, Shenandoah has won 13, 10 and 10 matches.
"In looking at our program, I have determined that we need to move in a different direction," Dr. Lyons stated. "I believe we should be competitive in the conference and vying for conference championships.
"I do want to thank Jaime for all of her hard work over the past nine seasons and wish her well in her future endeavors."
Lyons also stated that the university will conduct a national search for Terenzi's replacement.
"The James R. Wilkins, Jr. Athletics & Events Center is one of finest facilities in Division III and will be a recruiting advantage to our new coach," Lyons said.
The university opened the 77,000 square foot Wilkins Center in January with the volleyball team playing its inaugural season there this past fall.