The GLONASS satellites, intended for Russia's rival to the American GPS system, a project dear to the Kremlin, were lost because the Proton M rocket carrying them into orbit was loaded with too much fuel, a investigating commission found.
A Kremlin spokeswoman said the deputy head of the Russian space agency Roskosmos, Viktor Remishevsky, and the deputy head of the Russian rocket manufacturer Energia, Vyacheslav Filin, had both been fired over the calculation error.
Medvedev also issued an official reprimand to Roskosmos head Anatoly Perminov.
The satellites were to be the last of 24 needed for Russia to fully deploy GLONASS -- short for Global Navigation System -- next year.
Putin has personally promoted GLONASS as strategically important in helping to build Russian technological independence and stimulate the production of domestic consumer devices such as smartphones and vehicle sat-navs.
He has even fitted his black labrador dog Connie with a collar bearing a GLONASS transmitter.
Experts have estimated that the crash cost Russia 5 billion roubles ($160 million) and set back GLONASS by six months.
The Russian business daily Vedomosti said the satellites had been insured for only 5 percent of their value.
(Writing Alissa de Carbonnel; Editing by Kevin Liffey)