Wednesday's announcement by the team followed their 3-0 defeat to Juventus on Tuesday which left them on the brink of elimination from the Champions League.
"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," Chelsea said on their website.
"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."
The club will be making an announcement shortly regarding a new first team manager. – Reuters.