Chelsea announce that Rafael Benitez will take over as interim manager until the end of the season following the sacking of Roberto Di Matteo.
Benitez is the former manager of Liverpool, whom he led to the Champions League title in 2005, and Inter Milan, who sacked him after just six months.
Di Matteo was sacked six months after helping Chelsea win their first ever Champions League final.
The decision to sack him follows the 3-0 loss in the Champions League to Juventus on Tuesday, which took Chelsea's hopes of reaching the last 16 out of their hands and put them at risk of becoming the first holders to fail to reach the subsequent knockout phase.
The Blues have also failed to win any of their last four Premier League games, a run which has seen them slip from top to four points behind leaders Manchester City.
A number of names were touted as potential replacements for Di Matteo and Benitez was the bookies favourite. On Wednesday, William Hill had Benitez being appointed at odds of 8/11. He had been previously considered for the role following the departure of Di Matteo's predecessor Andre Villas-Boas.
However, there were other names linked to the job, including former Barcleona manager Pep Guardiola.
Guardiola, who won the Spanish league three teams in four seasons with the star-studded Barcelona team, is currently on a year-long sabbatical which started in April.
There will be speculation that Benitez has been brought into 'keep the seat warm' ahead of Chelsea offering the position to Guardiola in the summer.
Other names linked to the job included the self-styled "special one", Jose Mourinho, who is Chelsea's most successful manager ever and has expressed a desire to return to the Premier League, and former Tottenham manager Harry Redknapp.
'Not been good enough'
The club released a statement on Wednesday morning announcing Di Matteo's departure. The statement read:"The team's recent performances and results have not been good enough and the owner and the Board felt that a change was necessary now to keep the club moving in the right direction as we head into a vitally important part of the season.
"The club faces a difficult task ahead in qualifying for the knockout stages of the UEFA Champions League as well as maintaining a strong challenge for the top of the Premier League while competing in three other cup competitions. Our aim is to remain as competitive as possible and challenge strongly on all fronts.
"The owner and the board would like to thank Roberto for all he has done for the club since taking over in March. Roberto helped guide us to an historic Champions League victory and a seventh FA Cup. We will never forget the huge contribution he has made to this club's history and he will always be welcome at Stamford Bridge."
On Tuesday night, Di Matteo said, ahead of Chelsea's announcement, that blame for the poor result lay with him.
"I'm responsible for the result. I'm responsible for the performance. It's a negative evening for us," he said. "If anyone has to take the blame, it's me. I selected a team I was convinced was the right team to win against Juventus, or get at least a draw, so the blame belongs to me."
However, the decision also comes six months after Chelsea won the Champions' League and the FA Cup. Under Di-Matteo's stewardship Chelsea has won 24 matches, drawn nine and lost nine.
The decision ends the tenure of Chelsea's ninth manager in nine years under the ownership of business tycoon Roman Abramovich, who took control in June 2003.
Di Matteo, who played for Chelsea in the 1990s, has left the club eight months after taking over as interim first team coach from Villas-Boas, and five months after being officially appointed Chelsea manager.
He has had the fifth shortest tenure under Abramovich, who reportedly paid £60m for the club, behind (in order): Wilkins (one match), Guus Hiddink (three months), Luiz Felipe Scolario (seven months) and Avram Grant (eight months). Di Matteo served as Chelsea manager for 18 more days than Grant.
The shortest tenure as manager belongs to Ray Wilkins, who took over the role in an interim capacity for one match following the departure Luiz Felipe Scolari in February 2009.