Nietzsche (1844-1900) was fond of making dramatic statements to make a point and get reactions. His statement "God is dead, and we have killed him" must be understood in that light, and also in light of the issues he was speaking of at the time.
Modern life and thinking, to Nietzsche's way of thinking, had brought an end to the meaning found in the Abrahamic faiths (Christianity and Judaism, and, if he dealt wit it, Islam). If we take the drama out of his statement, he is saying, "The idea of God found in Christianity and Judaism is no longer powerful and relevant because our modern lives and thinking are taking us in a different direction." But writing like that does not lead to fame and drama.
The result of Nietzsche's drama is that he is often misunderstood. He was not an absolute nihilist; he found value in Buddhist ideas, and Buddhism rejects nihilism. It is not even clear that he was an atheist. He might have been saying, "our old ideas of God are dead."
Nietzsche was not a systematic thinker. He was more of a provocateur. Let us use his writing to provoke our own thinking in healthy, positive ways, not in the destructive ways it was used later in Germany to justify the Nazi regime.