Associate head coach Jay Triano will be the interim coach. ESPN.com's Adrian Wojnarowski first reported the news of the firing.
Watson, who took over the job midway through the 2015-16 campaign after Jeff Hornacek was jettisoned, went 33-85 over two-and-a-half seasons in the desert.
The 59-year-old Triano owns a lifetime record of 87-142, including two seasons (2008-09 and 2010-11) that featured 25 or fewer wins.
The reported move came a shade over an hour after Suns point guard Eric Bledsoe seemingly tweeted his displeasure with the franchise:
Los Angeles Clippers center DeAndre Jordan later tweeted an apparent response to his former teammate:
The Suns, who finished last season a Western Conference-worst 24-58, surrendered an average of 128.7 points per game over their first three games and ranked dead last in net rating (-26.2) through Saturday, according to NBA.com's stats database.
In addition to the porous defense, Phoenix's offense has struggled mightily through the season's opening week with a 76-point outing against the Portland Trail Blazers and 88-point effort versus the Los Angeles Clippers.
The lone offensive bright spot was a 130-point outburst against the Los Angeles Lakers, but the Suns' anemic defense overshadowed positive takeaways in the scoring department.
Moving forward, the onus will be on the Suns' interim coaching staff to simply aid in the development of promising youngsters Devin Booker, Josh Jackson, Marquese Chriss and Dragan Bender as the franchise tries to avoid a second straight finish in the Western Conference cellar.
🔥 Top Videos from Around B/R 🔥
Westbrook's Road to 100 Triple-Doubles
The NBA Is a Mess in the Best Way Possible
The NBA Still Has a Massive Tanking Problem
Rodman Is Living His Best Life in New Jersey Suburbs
Has the Brow Forced His Way into MVP Convo?
Sunday's ASG Was a Start, but It Still Needs Fixing
Hawks Fans Keep Getting Burned by Hot Sauce
Relive AI and Kobe Facing Off in the ASG
Who Is the Dancing Rockets Fan?
30 Years Ago Today MJ Took Flight
Teams That Must Make a Deal at Trade Deadline
How a 7-Foot Farmer Became Iceland's NBA Prospect
MJ Superfan Gets Crying LeBron Tattoo
Panic Time for Cavs, but What Can They Do?
Beck Reveals His 2018 NBA All-Star Ballot
Time for the Grizzlies to Trade Marc Gasol
I.T. Now the Biggest Question Mark of the Season
The Night in the NBA: Beasley Gets MVP Chants, DeRozan Drops 45 and More
Still Too Soon to Declare Anything About Any Rookie
We Owe the Indiana Pacers an Apology