"Aston Villa Football Club has today parted company with manager Roberto Di Matteo," the club said in a statement.
"The club decided to act following a run of disappointing results which has the left the team occupying 19th position in the Championship."
Di Matteo took over in June after the club were relegated from the Premier League last season but has managed to win only one of 11 Championship matches, leaving the club two points above the relegation zone.
They also lost in the first round of the League Cup to fourth tier Luton Town.
The seven-times English champions are playing in England's second tier for the first time since they were promoted to the first division in 1988.
Assistant coach Steve Clarke will take charge as caretaker manager during the search for a new boss, the club added.
Di Matteo's final game in charge was Saturday's 2-0 defeat at Preston North End.
"I have faith in the team and believe in the team," Italian Di Matteo said after that latest setback.
(Reporting by Martyn Herman in London and Ian Rodricks in Bengaluru; editing by Amlan Chakraborty)
