The Italian has been dismissed following last night's 3-0 defeat to Juventus in Turin.
The club is now in danger of becoming the first Champions League holders to fall at the group stage.
Chelsea are now considering turning to either Avram Grant or Rafael Benítez as their temporary manager as owner Roman Abramovich looks to persuade Pep Guardiola to take up the helm at Stamford Bridge.
In a statement, Chelsea said: "Chelsea Football Club has parted company this morning with manager Roberto Di Matteo.
"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.
So Roman can't exercise a little patience?
"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.
"The club will be making an announcement shortly regarding a new first team manager."
"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.
"The club will be making an announcement shortly regarding a new first team manager."
So Roman can't exercise a little patience?
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