Jimmy Calderwood has emerged as the early favourite to land the Dundee job as the club begins the search for Barry Smith's successor.
Smith's departure was confirmed in a short statement on the club's website. And former Dunfermline and Aberdeen boss Calderwood has quickly been installed as the front-runner to fill the vacancy by bookmakers.
The decision to part company with Smith was taken following a run of results which left Dundee 15 points adrift at the bottom. Asked how tough a decision it was to make, chief executive Scot Gardiner told Sky Sports News: "It was extremely difficult. It would be extremely difficult for anyone who knows anything about Dundee."
Smith captained the club and made 400 appearances as a player before returning to Dens Park as first-team manager. He also guided the club through their 2010-11 campaign - dubbed the 'Dee-Fiant' season - after Dundee retained their place in the Irn-Bru First Division despite a 25-point deduction for a second descent into administration.
Gardiner added: "The word 'legend' is too often bandied about but he has been here for 17 years, through two administrations, coached the club, played for the club, captained the club, led it out at Hampden. He brought 'Dee-Fiance' after a 25-point deduction. Outrageous and amazing things. However, football is a very cruel game."
The club statement read: "Dundee FC today announced that they have parted company with manager Barry Smith with immediate effect. Until matters regarding this have been formally concluded, no further statement will be made."
Dundee look set for a quick return to the First Division, following their hasty promotion to the SPL. They were late additions to the top flight in the summer, after replacing Rangers, and have struggled to compete throughout the campaign.
Smith's future came under scrutiny in early January, with reports suggesting his position would be discussed by the club's directors. He then appeared to receive the backing of the board, who acknowledged the difficult task he has faced this term, while vowing to boost their survival bid by adding new players before the transfer deadline.
David Morgan was signed on loan from Nottingham Forest and former fans' favourite Gary Harkins also returned to Dens Park. But results failed to improve and the SPL strugglers have not registered a single victory in their last 12 league outings.
They face a daunting trip to Celtic Park to face the league leaders on Sunday.