The Merseysider had been given a stay of execution earlier in the season, but the board has acted swiftly following the club's 6-1 thrashing by Portsmouth at the weekend..

The club released a statement on Reid's departure, thanking him for his efforts in preserving their Premiership status last season.

"While the board acknowledges that Peter did a sterling job for the club towards the end of last season in keeping United in the FA Premier League, it believes it must not allow this season to reach a point beyond which the club’s Premiership status comes under serious threat," it read.

"The recent run of results has clearly been unacceptable. The board therefore concluded that it has a duty to act now.

"With effect from tomorrow (Tuesday) morning, Eddie Gray will take over the duties of the first team manager on a caretaker basis, assisted by Kevin Blackwell, the chief coach.

"The process of identifying a longer term first team manager is underway and the board has a clear view of the credentials required of any candidate.

"Notwithstanding current financial constraints, United is determined to return to its place as one of the top clubs in England and is looking to appoint a new first team manager who will reflect this determination.

Commenting on the change, Trevor Birch, chief executive said: “It is of course sad to part company with Peter under these circumstances.