The European champions moved quickly to remove Di Matteo following Tuesday's 3-0 defeat to Juventus [ Images ] left the title-holders on the brink of elimination from a tournament they won on a memorable night in Munich on May 19.
The club would make an announcement shortly regarding a new first team manager, Chelsea said in a statement on Wednesday.
"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 [ Images ] Champions League as well as maintaining a strong challenge for the top of the Premier League while competing in three other cup competitions.
"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 [ Images ]," the statement said.
Di Matteo took Chelsea to Champions League and FA Cup glory last season as caretaker manager following the sacking of Portuguese Andre Villas-Boas and was given the job on a permanent basis in June.
The Italian was the eighth manager to have worked under owner Roman Abramovich since the Russian billionaire brought the Premier League club in 2003.
Chelsea made a flying start to the season under Di Matteo, winning seven and drawing one of their opening eight Premier League games to go four points clear at the top of the table.
Since then, however, they have won just two of their last eight games in all competitions, slipped to third in the league and are on the brink of suffering the ignominy of becoming first holders to go out of the Champions League at the group stage.
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