Former England star Paul Merson has been sacked as Walsall player-manager after a poor run of results, including Saturday's 5-0 drubbing at Brentford.
Ex-England star Merson joined the club as a player in 2003
Chairman Jeff Bonser told the club website: "I felt that we had reached a point where it was in the best interests of both the club and Paul.
"We have all enjoyed working with Paul and wish him every success."
Youth coach Mick Halsall has taken charge on a temporary basis but is not interested in the post permanently.
The Saddlers are only one point clear of the relegation zone and are without a win in the league this year.
Merson joined the club as a player in 2003 and became boss in 2004 for the final four games of the 2003-04 season.
He arrived at the end of a season in which the Saddlers were relegated and guided them to 14th place in League One last season.
Bonser added: "I hope that our supporters will never forget the euphoria created when he joined the club. He must have been the most high-profile signing ever made by us.
"Nor should we forget the extraordinary skills he displayed while playing for the club. He must surely have been the most gifted player to represent Walsall.
"He accepted the position of manager at a most difficult time, following relegation and the draconian financial fall-out that followed the demise of ITV Digital.
"Inevitably, relegation led to a number of key players leaving the club and a very limited availability of funds to rebuild the team."
Walsall sold top scorer Matty Fryatt to Leicester in January and also allowed second highest scorer Jorge Leitao to return to Portugal while Bonser feels that injuries have played a major part in their struggles this season.
He added: "Paul has not enjoyed much luck during this period. In all my 18 years involvement in football, I have never known a time when we have been so hard hit by injuries.
"If all of these players had been available to Paul throughout the season, I have no doubt that our results and position in the league table would have been very different.
"I have always admired the way that he has been prepared to give young players their chance.
"Hopefully some of them who have been groomed by Paul will go on to have bright futures in the game and will have much to be grateful to him for giving them their first chance."