The English Football Association has confirmed that Fabio Capello has quit as England manager.
The Italian coach's resignation came after he met with FA chairman David Bernstein to discuss the ruling body's decision to remove the England captaincy from defender John Terry.
An FA statement read: "The Football Association can confirm that Fabio Capello has today resigned as England manager."
Capello has since said quotes attributed to him by other Italian news agencies attacking the FA were "false".
The FA statement went on: "This follows a meeting involving FA chairman David Bernstein, FA general secretary Alex Horne and Fabio Capello at Wembley Stadium.
"The discussions focused on the FA board's decision to remove the England team captaincy from John Terry, and Fabio Capello's response through an Italian broadcast interview.
"In a meeting for over an hour, Fabio's resignation was accepted and he will leave the post of England manager with immediate effect."
Bernstein said the resignation was the right course of action.
The FA chairman said: "I would like to stress that during today's meeting and throughout his time as England manager, Fabio has conducted himself in an extremely professional manner.
"We have accepted Fabio's resignation, agreeing this is the right decision. We would like to thank Fabio for his work with the England team and wish him every success in the future."
Bernstein and the Club England management team will hold a media conference at Wembley at 12 noon tomorrow.
The shock resignation brings an end to Capello's four years in charge of England - he had been due to step down after the European Championship and leaves the FA needing to appoint a replacement as soon as possible.
The next international is later this month, a friendly against Holland on February 29 at Wembley.
The timing of the meeting coincided almost exactly with Tottenham boss Harry Redknapp, the outstanding candidate to replace Capello, being cleared of tax evasion charges.
The FA's decision to go over Capello's head and strip Terry of the captaincy until after his July court case where he will deny racially abusing QPR's Anton Ferdinand led to the Italian quitting his £6m-a-year post.
Capello told Italian TV that he "absolutely" disagreed with the action against Terry and that set him on a collision course with the FA.
Former England defender Danny Mills criticised the FA for their handling of the situation and claimed the Euro 2012 campaign will be compromised as a result.
"It think the FA have handled this very badly," he told Radio Five Live.
"He's obviously decided enough's enough and walked out. He's almost dropped England right in it.
"There's an awful lot of preparation that has gone in it (Euro 2012). It just causes disruption. There will be speculation that people don't need.
"Players will be asked about Capello, the new manager and about John Terry. He's justified in his decision. Do England need this leading into a major tournament?"
Mills was also sceptical about whether Tottenham boss Harry Redknapp, the favourite to take over the reins, would be able to juggle the England job with his duties at Spurs.
"I presume Harry Redknapp is the favourite, but he's got a job to do with Spurs until the end of the season," he said.
"The FA have handled this really badly. You have to find a man very quickly. Someone who wants the job.
"If it's going to be Harry Redknapp are Spurs going to allow it? The FA are almost going to be held to ransom. The Euros is going to be a trial for whoever takes charge."
