World Bulletin / News Desk
According to the official STA news agency, his deputy Alan Geder was named as Osterman's replacement.
Osterman had been at the helm since 2014.
The decision came after an elite brigade failed in all but one of the five areas during a NATO combat readiness assessment at a training facility near the southwestern town of Postojna, STA reported.
It added that a 800-strong battlegroup was inspected in five areas; planning, operation, logistics support, communication and administration.
Prime Minister Miro Cerar on Thursday tweeted he expects Defense Minister Andreja Katic to put things in order and establish control.