The North London club confirmed the news via an official statement on their website on Monday morning, adding: "The decision was by mutual consent and in the interests of all parties."
Updates from Saturday, Dec. 22
From Sunday Times reporter Duncan Castles:
Tottenham's bill for removing Andre Villas-Boas as their 'head coach' is expected to amount to less than £3million, a sum which chairman Daniel Levy hopes will be made up for by his successor increasing the transfer value of the club's current squad.
According to the terms of his severance package, Villas-Boas will continue to receive a annual salary of €3m net until the summer of 2015 when his White Hart Lane contract was due to expire. Once the Portuguese takes on a job that pays at least that amount, however, Tottenham's liability ends.
Villas-Boas has seemingly paid the price for two embarrassing results this term, firstly a 6-0 humbling by Manchester City, followed by their drubbing at home to Liverpool.
Pressure has built on the Portuguese coach since the summer sale of Gareth Bale, whose funds were instantly injected back into the squad.
Villas-Boas was allowed to spend in the region of £100 million on the likes of Erik Lamela, Etienne Capoue, Christian Eriksen, Nacer Chadli, Vlad Chiriches, Paulinho and Roberto Soldado in order to set up a sustainable title challenge this term.
Many of those investments have not shown signs of bedding in—Lamela has started only two league games—leaving Spurs five points outside the Champions League spots and eight behind North London rivals Arsenal.
Villas-Boas seemingly acquired an ill-balanced squad, lacking genuine width on the left flank. The likes of Chadli, Gylfi Sigurdsson and Eriksen all cut inside when deployed out wide, making Spurs an increasingly predictable outfit.
They were outclassed in every area of the pitch against Liverpool and have scored fewer goals than the other top-10 teams in the division. Even Luis Suarez alone has netted more times than Villas-Boas' side.
Defensively, after a solid start to the campaign, Spurs have also conceded the second-highest number of goals among the Premier League's top 10.
However, a large section of Spurs fans will surely still feel Villas-Boas' dismissal is premature. Having completely revamped his squad, it was always going to take time for players to settle.
Tottenham's biggest summer signing, Lamela, is still coming to terms with life in England and has been afforded less than six months under his new manager.
While league form has not been good, Spurs were hardly in crisis, still in touch with the top four and looking strong in both the Europa League and Capital One Cup.
Villas-Boas' dismissal arrives after weeks of reports that he had sparked internal fallouts at Spurs. Matt Barlow of the Daily Mail reported in November that the Portuguese had lost his players' trust by saying they should be ashamed of their loss at City. The same article also claimed the medical staff had been at odds with their boss over Hugo Lloris' concussion at Everton.
This dismissal marks yet another unhappy chapter for Villas-Boas, who lasted less than a year at Chelsea in his previous Premier League job.
Fabio Capello is tipped as a potential successor for the White Hart Lane hot seat, after he was seen watching Spurs against Liverpool on Sunday, per Metro.
For now, the decision leaves Tottenham in a state of disarray at the busiest time of their season, raising severe question marks over the board, who could barely have timed their announcement at a worst moment.