He had replaced Saeid Armaghani on a one-year deal in May 2023 but the Iranian federation didn’t extend his contract.
The 55-year-old coach was also the head coach of Turkish side Manisa Metropolitan Belediyespor in the Turkish Insurance Basketball Super League.
Demir led the Iran basketball team in the 2023 FIBA World Cup, where the Persians had been drawn in Group G along with Spain, Brazil and Ivory Coast.
He also headed the Iranian team in the 2022 Asian Games in Hangzhou.
Italian coach Marco Ramondino and Slovenian Rado Trifunovic are among the candidates to replace Demir.