Android: How to Delete synced Contacts

If you wish to delete all contacts from your Android device, without deleting from gmail...

1. Disable syncing by going to Settings > Accounts & sync. Select your Google account and uncheck Contacts. If you sync contacts with other apps such as Facebook or Twitter, be sure to disable syncing for those apps as well.

2. Go to Settings > Applications > Manage applications > All > Contacts Storage and select Clear data.
Note: This will also clear other data like your recent calls and Favorites

Thanks to  Mitch Bartlett for his post of Android: How to Delete All Contacts