Villas-Boas cost Chelsea's billionaire owner £13.3million to land from Porto after Carlo Ancelotti was also despatched by the Russian, but the Portuguese's reign has been ended after a dismal 1-0 defeat at West Brom on Saturday proved the final straw.
Roberto Di Matteo has been appointed interim manager until the end of the season, but the Portuguese's exit clears the path for Rafa Benitez or Pep Guardiola to take over. Benitez wants at least an 18-month deal to take over the reins but owner Abramovich is thought to favour attempting to bring in Barcelona's coach in the summer.
Chelsea, so far, have only discussed him doing the job until the end of the season, meaning there will have to be a compromise in the next 48 hours if Benitez is to be in place for the game against Birmingham.
Dead on his feet: AVB moved to west London from Porto in the summer
Owner Abramovich is thought to favour attempting to bring in Barcelona coach Pep Guardiola in the summer, hence the desire to offer Spaniard Benitez a short-term contract and the announcement that Di Matteo will take charge until the end of the season.
Chelsea said in a statement on their official website: 'Andre Villas-Boas has parted company with Chelsea Football Club today.
Nail in the coffin: Chelsea lost 3-1 at Napoli in the first leg of their Champions League last-16 clash after Villas-Boas made the bold decision to leave Ashley Cole and Frank Lampard on the bench (below)
Dropped: Ashley Cole and Frank Lampard on the bench at Napoli
'The board would like to record our gratitude for his work and express our disappointment that the relationship has ended so early.
'Unfortunately the results and performances of the team have not been good enough and were showing no signs of improving at a key time in the season.
Poor form: Chelsea suffered a number of chastening defeats this season: including the 5-3 reversal to Arsenal (above) and the Carling Cup defeat to Liverpool (below)
VILLAS-BOAS FACTFILE
1977: Born in Porto on October 17.
1993: Invited to work as a trainee with FC Porto's youth-team coaches by manager Sir Bobby Robson.
1994: Achieves UEFA C coaching licence in Scotland.
2000: Takes charge of the British Virgin Islands for two international matches. Both end in defeat.
2002: Becomes part of Jose Mourinho's backroom staff at Porto.
2004: Follows Mourinho to Chelsea, where he works as an opposition scout.
2008: Moves with Mourinho to Inter Milan.
2009: Appointed manager of Academica in October, with the club bottom of the table and without a win. Villas-Boas guides them to an 11th-place finish and a Portuguese League Cup semi-final.
2010: June 2 - Appointed manager of boyhood club Porto.
August 7 - Wins Portuguese Supercup with 2-0 victory over Benfica.
2011: April 3 - Leads Porto to their 25th league title, finishing with their biggest ever winning margin of 21 points.
May 18 - Porto win the Europa League with a 1-0 triumph over fellow Portuguese side Braga.
May 22 - Guides Porto to a trophy treble with a comprehensive 6-2 win over Vitoria de Guimaraes in Portuguese Cup final.
June 21 - Porto confirm Villas-Boas has tendered his resignation and his contract will be terminated once his 15million euros release clause has been paid. Porto later announce they have received the required compensation, with Chelsea releasing a short statement confirming their interest in Villas-Boas and their intention to agree personal terms in the near future.
June 22 - Appointed Chelsea manager on a three-year contract.
September 18 - Suffers first defeat of the season with a 3-1 loss to Manchester United at Old Trafford.
December 12 - Chelsea become first team to in 2011/2012 season to defeat Manchester City coming from behind with goals from Raul Meireles and a late penalty by Frank Lampard.
2012: February 21 - Leaves Ashley Cole, Frank Lampard and Michael Essien out of the team as Chelsea fall to a 3-1 defeat in their first leg Champions League tie with Napoli. Chelsea now have a record of one win in the last 7 games and is under pressure at the club from fans and players alike with Ashley Cole in particular criticising his tactics.
March 4 - Sacked by Chelsea a day after a 1-0 defeat at West Brom.
'The club is still competing in the latter stages of the UEFA Champions League and the FA Cup, as well as challenging for a top-four spot in the Premier League, and we aim to remain as competitive as possible on all fronts.
'With that in mind, we felt our only option was to make a change at this time.
'With immediate effect, Roberto Di Matteo has been appointed first-team coach on an interim basis until the end of the season.'
Villas-Boas had been under mounting pressure after overseeing what was threatening to be Chelsea's worst season since Abramovich bought the club almost nine years ago.
A run of just five wins from the last 16 games saw the Blues slide out of the top four, while they remain in real danger of crashing out of both the Champions League and FA Cup in the next week and a half.
Brought in to revamp an ageing squad after winning an incredible quadruple at Porto last season, Villas-Boas' reign was dogged by reports of the kind of dressing-room unrest that previous Chelsea managers have said led to their own downfall.
Abramovich, who reportedly hand-picked Villas-Boas last summer when Guus Hiddink had been the bookmakers' favourite to succeed Carlo Ancelotti, appeared prepared to be more patient with the 34-year-old than previous bosses.
The Russian seemingly recognised the difficulties in overhauling the squad and the playing style at Stamford Bridge.
But, as when Luiz Felipe Scolari was sacked three years ago, it was fear of not qualifying for the Champions League that prompted Abramovich to act.
Having repeatedly insisted he had the owner's full backing during the recent run, Villas-Boas appeared to acknowledge the writing may be on the wall during the past week and a half.
An interview with a Portuguese radio station saw him admit for the first time he could lose his job, a possibility he refused to shy away from after yesterday's defeat at the Hawthorns.
He said: 'Will this result increase pressure on me? You have to agree with it. We are in the same position, fifth, but we are now three points behind Arsenal.
'It is a big, big disappointment. Every defeat Chelsea suffers piles more pressure on any manager.'
Villas-Boas insisted it would not help his position being given public backing from Abramovich.
He said: 'I don't think so. There is no need for the owner to back us after such a poor display.'
Villas-Boas, who on Friday insisted he would 'never' quit Chelsea, added: 'Am I the right man for the job? Yes. I wouldn't have taken it if I didn't think that.'
Di Matteo's first game in charge will be Tuesday night's FA Cup fifth-round replay at Birmingham.
Final straw: Chelsea's defeat at West Brom was the Portuguese's last game in charge of the Blues
ANDRE VILLAS-BOAS FACTFILE
CLAUDIO RANIERI (September 2000 to May 2004)
Life under Abramovich: The first manager to spend Abramovich's billions was under pressure from day one amid rumours Sven-Goran Eriksson was being lined up to replace him. 'Tinkerman' tag did not help the Italian and, despite finishing second in the Barclays Premier League and reaching the Champions League semi-finals, he was sacked.
Life after Abramovich: Returned to former club Valencia, immediately winning the European Super Cup. But was sacked six months later and has won nothing since, despite landing prestigious jobs at Parma, Juventus, Roma, and now Inter Milan, where rumours abound he is on the brink of the sack.
JOSE MOURINHO (June 2004 to September 2007)
Life under Abramovich: Declared himself a 'Special One' and completely lived up to the moniker, becoming the most successful Chelsea manager ever. Immediately ended their 50-year wait for a league title with back-to-back Barclays Premier League crowns and also won the FA Cup and two Carling Cups. Champions League glory remained elusive and a power struggle with Abramovich eventually saw him leave.
Life after Abramovich: Heavily linked with the England job before eventually resurfacing at Inter Milan. One of the most successful bosses in their history, he became only the third manager to win the European Cup with two different clubs. Now at Real Madrid and on course to become the first man to win league titles in England, Italy and Spain.
AVRAM GRANT (September 2007 to May 2008)
Life under Abramovich: Less than two months after arriving as director of football, Grant found himself parachuted into the manager's hotseat. Speculation was rife he did not have the backing of the dressing room but still managed to get the club to their only Champions League final. Also reached the Carling Cup final and finished second in the Premier League before sacking.
Life after Abramovich: History repeated itself as Grant joined Portsmouth as director of football in October 2009, once again becoming manager less than two months later. Boosted reputation by leading side to the FA Cup final despite administration saga that saw them relegated. Resigned and joined West Ham but was sacked after they were also relegated.
LUIZ FELIPE SCOLARI (July 2008 to February 2009)
Life under Abramovich: Billed as the man to inspire Chelsea to take final step in Champions League, World Cup-winner Scolari enjoyed a flying start but things soon began to go wrong amid rumours of dressing-room unrest. The timing of the Brazilian's sacking after just seven months still came as shock.
Life after Abramovich: Made surprise decision to join Uzbekistani champions FC Bunyodkor, although the salary reportedly made him the one of the highest paid managers around. Left after less than a year and returned to former club Palmeiras, where he has enjoyed mixed fortunes.
GUUS HIDDINK (February 2009 to May 2009)
Life under Abramovich: Still revered by players and fans for rescuing Chelsea's season while combining Russia job with a caretaker role at Stamford Bridge. Won the FA Cup and desperately unlucky not to reach the Champions League final, Hiddink lost only one game in charge.
Life after Abramovich: Continued as Russia boss until June 2010, leaving after failing to lead them to the World Cup. Became Turkey manager but left in November after losing another play-off, this time for the European Championships. Persistently linked with a return to Chelsea after Carlo Ancelotti was sacked before joining mega-rich Russian club Anzhi Makhachkala in February.
CARLO ANCELOTTI (June 2009 to May 2011)
Life under Abramovich: Recruited largely because of two Champions League successes at AC Milan, instead delivered Chelsea's first ever double in maiden season. Nevertheless damaged by losing in the Champions League last 16, a slump last term resulted in a trophyless campaign saw the Italian axed.
Life after Abramovich: Linked with several jobs in England and abroad, December saw him appointed manager of big-spending Ligue 1 leaders Paris St Germain.
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