Monday 13 January 2014
The 18-time Italian champions are 11th in Serie A, 30 points behind leaders Juventus.
Allegri, 46, who was due to leave the San Siro when his contract expired at the end of the season, departs along with his backroom team.
Assistant coach Mauro Tassotti, a former Milan player, has been put in temporary charge of the side.
A club statement read: "Massimiliano Allegri and his staff have been relieved of their duties.
Allegri fact-file
- Born: 11 August 1967
- Playing career: As a journeyman midfielder, played for 11 different Italian clubs in various divisions
- Coaching career: Won the Serie A title with Milan after impressing with lesser lights Cagliari
"AC Milan would like to thank Mr
Allegri and his staff for their time with the club and wishes them the
best for the future."
Former Cagliari boss Allegri
led Milan to the Serie A title
in his first season in charge after
replacing Leonardo
in June 2010.
They finished as runners-up to Juventus the following year but ended last season 15 points behind Juventus, who won the title again.
Following Sunday's defeat to Serie A newcomers Sassuolo, club director Barbara Berlusconi - the daughter of owner Silvio Berlusconi - said it was "a disappointing evening, like others, which confirms that a change is both necessary and urgent with the contribution of everyone concerned.
"It's no longer tolerable that our fans participate in performances like these."
Tassotti, 53, spent 17 years as a player at the San Siro and has been on the coaching staff since he retired from playing in 1997.
