The glamorous Dutchman, who has restored Chelsea's reputation as football's most fashionable team, was relieved of his duties as player-manager after negotiations to extend his contract beyond this summer apparently foundered over pay and conditions.
Gullit, however, denied the club's version of events - which suggested he abruptly walked out when told of the move - and claimed he not only found out about the decision from the media but had always intended to resign.
Gianluca Vialli, the Italian striker, has been appointed player-manager with immediate effect. Gullit, 35, will continue to be paid until July but will take no further part in the club's season which is reaching a crucial stage.
The decision stunned the football world. Gullit, who had never managed before, has been a great success at a club whose self-image has never been matched by its achievements. Last May, he steered Chelsea to victory in the FA Cup final, their first major honour since 1971, and at present they are second in the Premiership, have reached the quarter-finals of European Cup-Winners' Cup, and play in the Coca-Cola Cup semi-finals on Wednesday.
Chelsea said the timing of the move was forced upon them by the need to avoid managerial uncertainty affecting next season's plans. The club said it had been negotiating for three months but Gullit's pay demands were way in excess of what it was prepared to pay. Gullit, who has called a press conference for this morning, said there had only been one, amicable, meeting and he was "astounded" by the decision.
The choice of successor will not have helped. Though Gullit signed Vialli in July 1996, their relationship deteriorated with Vialli frequently omitted from the team. Yesterday Vialli said his first task was to improve morale and restore "honesty" in communications.
Gullit arrived in England in the summer of 1995, signed by Glenn Hoddle, then manager of Chelsea, now the England coach.
He was revered as one of the best players the game has ever seen and his arrival epitomised the English game's recovery from the dark days of hooliganism to its current fashionable status. He was appointed manager when Hoddle left to take over the England job. Sport, page 30Reuse content