The 52-year-old, who guided the team to the Premier League title last term, has left Stamford Bridge by mutual consent after the club deemed results "not good enough this season"
Jose Mourinho has been sacked by Chelsea after a meeting with the club's hierarchy on Thursday.
The 52-year-old, who guided Chelsea to the Premier League title last season, ends his second stint at Stamford Bridge with the team languishing in 16th place in the table, registering just 15 points from 16 games.
Mourinho had been rewarded for last season's success with a new four-year contract worth £30 million, which was signed in August.
A statement from Chelsea read: "All at Chelsea thank Jose for his immense contribution since he returned as manager in the summer of 2013.
"His three league titles, FA Cup, Community Shield and three League Cup wins over two spells make him the most successful manager in our 110-year history. But both Jose and the board agreed results have not been good enough this season and believe it is in the best interests of both parties to go our separate ways.
"The club wishes to make clear Jose leaves us on good terms and will always remain a much-loved, respected and significant figure at Chelsea. His legacy at Stamford Bridge and in England has long been guaranteed and he will always be warmly welcomed back to Stamford Bridge.
"The club’s focus is now on ensuring our talented squad reaches its potential.
"There will be no further comment until a new appointment is made."
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Since winning the title, Mourinho has suffered a turbulent campaign amid widespread reports of unrest in the Chelsea dressing room. Following the side's 2-1 defeat to Leicester City on Monday evening, the Portuguese turned on his players by accusing them on 'betraying' him and claimed that he was the main reason behind their title win last term.
Mourinho also gave a sarcastic assessment of Eden Hazard's injury and felt that the Belgian "had three different perspectives" in just "a few seconds".
The Portuguese was also forced to play down a rift with Diego Costa after the striker threw a bib towards the former Chelsea boss during the club's goalless draw with Tottenham at the end of November.
Mourinho was also criticised for his handling of Eva Carneiro's role at Chelsea. The 42-year-old physio, who left Stamford Bridge in September, was branded "naive" by Mourinho for running onto the pitch to treat Eden Hazard in the final stages of the 2-2 draw with Swansea City on the opening day of the season, and subsequently saw her role downgraded.