Paul Holt, 43, son of Revd Wendy Oliver, confessed at Bolton Crown Court to an interest in 'the feet of young children' before being spared a prison sentence on July 20.
The Diocese has also forced Mr Holt to move out of the vicarage at Christ Church Harwood, where he was living with his mother when he was arrested in December 2013.
According to the Bolton News, officers raided the vicarage after Holt was trapped by an international investigation led by Canadian Police.
The conviction came after 2,565 indecent images had been found on his computer. Holt had admitted 16 counts of possessing indecent images and distributing them.
A spokesman for the Diocese of Manchester said: "As a Diocese, we treat the protection of children as a top priority. We have clear safeguarding policies, and employ a full time safeguarding officer.
"Since Paul was charged in May 2014, we have been working with the police and local agencies to ensure that the situation has been handled robustly.
"Procedures were put in place from December 2013 when all this first came to light, which sought to ensure that Paul had no unsupervised contact with children in the church, and he has not attended Sunday worship at Christ Church since being charged."
The spokesman added: "In the circumstances, we recognise that from all points of view, it is important that Paul does not live at the Vicarage.
"At this time, Wendy has also felt it appropriate to take some leave from her duties. For immediate parish matters, people should contact either the wardens, Rev Jo McKee or Rev Heather Molloy.
"Whilst recognising the gravity of these offences and justice needing to be done, as Christians, may we all remember that no one puts themselves beyond the love, mercy and forgiveness of God."
The court heard that Holt had been downloading the images over a decade.
His barrister Nicola Gatto told the court that her client had also referred himself to a counsellor in a bid to change his ways - and was remorseful.
Ms Gatto, defending, said that at the start of the offending behaviour, in 2007, Holt's marriage had broken down and he had started to drink heavily.
In addition, she said that Holt had begun to question whether he was "truly heterosexual".
Judge Timothy Stead chose not to jail Holt, telling him: "Clearly you are a man who has had significant problems.
"You have had problems in your personal life, you have had problems with regard to the proper and responsible use of alcohol, and it is quite apparent that you have struggled with sexual issues.
"I have no doubt at all that your possession of the indecent images in this case was sexually motivated.
"It is a good thing that you have accepted that some sexual gratification has been involved in your dealings with these images.
"Don't let your mother down, don't let yourself down. Do what is expected of you."