Rycroft was replaced by Karen Pierce, country's first woman Ambassador to the UN. She is uniquely suited for the position having previously served as Deputy Permanent Representative to the UN in New York, and more recently as the Permanent Representative to the UN in Geneva, the UK Mission to the UN said in a statement.
Britain's Permanent Mission to the United Nations did not give any reason for appointing Pierce as new ambassador to the world body, which comes days after it failed to get its judge Christopher Greenwood elected to the International Court of Justice (ICJ) after India's Judge Dalveer Bhandari consistently received nearly two-third of the votes in the UN General Assembly.
Bhandari was on Tuesday re-elected to the ICJ as the UN General Assembly overwhelmingly threw its weight behind him, forcing Britain to withdraw its candidate from the hard- fought race to the world court. This is for the first time in 70 years that Britain would have no judge in the 15-member panel of the ICJ.
Political analysts and editorials in British media have described it as a diplomatic failure of the Therasa May government.
"Britain has a proud history of working for positive change through the United Nations, not least in addressing the problems in Libya and Syria," British Foreign Secretary Boris Johnson said in a statement without addressing the reason for sudden replacement of Rycroft.
Rycroft has been in the post since 2015 and will handover in January 2018 when he returns to London to take up his new role as Permanent Secretary at the Department for International Development.
"I know Karen has the diplomatic skills, energy and patience to continue this vital work, and I congratulate her on her appointment," Johnson said.
In a statement, Pierce said the UK had long been a strong supporter of the UN and its role at the heart of the global rules-based international system at a time when it is coming under challenge.
"Through our role as a permanent member of the Security Council and position as the UN's third largest donor, the UK will continue to work with others to tackle the pressing security, stability, development and prosperity challenges of today," she said.
"Our security and economic interests depend to a large extent on a strong and effective United Nations.I undertake to ensure we are an active force in New York for progress and partnership," Pierce said.