The 25-year-old was suspended by the Wesham-based club and then sacked after allegations he sent inappropriate messages, a club spokesman has confirmed.
A spokesman for Lancashire Police, who declined to confirm the coach’s identity, said: “A 25-year-old man from Preston was arrested on suspicion of abuse of a position of trust and has been bailed pending further enquiries until April 12.
“To clarify, the allegations relate to inappropriate social media contact between an adult and a 17-year-old.”
A national newspaper had claimed complaints were made to bosses at Mill Farm about the coach from eight individuals aged 15 to 18 with five interviewed by police detectives.
But a spokesman for AFC Fylde said: “On being made aware of a specific allegation against one of our Academy coaches, regarding inappropriate contact via social media against the individual concerned, the club immediately suspended the member of staff and reported the matter to the police and other authorities.
“Subsequent to this the member of staff was dismissed.
“All students on the club’s Academy course were made aware of the situation and the club continues to provide them and their families with support as required.
“The club continues to co-operate with and will fully support the authorities with their ongoing investigations.
“As the matter is now being dealt with by the police neither the club, or any of its officials, will be commenting further.”