Barnsley will make an approach to the Republic of Ireland's coach, Mick McCarthy, to replace Hendrie. The former Barnsley player may be willing to take on both jobs, although Barnsley would rather make a full-time appointment.
Dave Bassett and Nigel Spackman are also tipped to be interviewed for the post although Ronnie Glavin, a local favourite who had FA Cup success with Emley, is also in the running. Kevin Richardson is also admired within the club, although they may want a more experienced candidate following the failure of Hendrie to make the successful transition from player to manager.
Hendrie replaced Danny Wilson last summer following his departure to Sheffield Wednesday, but the Scot was unable to lift Barnsley above mid- table, with the highlight of the campaign a place in the quarter-finals of the FA Cup. They are lying 16th in the First Division.
Hendrie, who scored 16 goals as the Yorkshire club were promoted to the top flight for the first time in their history two years ago, said his dismissal did not shock him.
"I just came in for a normal day's training with the players, then went to see the chairman this afternoon because he said he wanted to see me," Hendrie said. "He pulled me in and just told me that it wasn't working out and relieved me of my duties. It was as quick as that.
"I live in the real world. Nothing in this game shocks me and I would just like to thank everyone at Barnsley who has supported me. I've had two and a half really good years there, with a lot of ups and a few downs."
Eric Winstanley has been appointed Barnsley's caretaker-manager, with Peter Shirtliff his assistant while the club searches for a replacement.
The club's chairman, John Dennis, said: "It's important that the rest of the backroom staff focus on a big game for us on Saturday at Huddersfield. Hopefully we will put on a good performance.
"Obviously our results have been disappointing and our league placing is disappointing so we thought it was time for a change. Each individual board member is a strong personality and has his own view but we came to the conclusion that it was time to act."
He added: "Unfortunately it's not worked out for John, he worked very hard at the job but things don't seem to have been right. It's a very sad day for a great guy, he was a hero for Barnsley when the team got promotion. His goals were instrumental in getting us promoted."
Barnsley made a slow start to the campaign as they tried to adjust to life back in the Nationwide League and the sale of Ashley Ward for pounds 4.5m was a setback to their promotion hopes.
Hendrie, 35, whose last match in charge was Friday's 3-1 defeat by the First Division champions-elect, Sunderland, joined Barnsley as a player in October 1996 and led their attack as they gained automatic promotion to the Premiership behind Bolton.
But the following season ended in relegation and after Wilson moved on, Hendrie - who also played for Coventry, Hereford, Bradford, Newcastle, Leeds and Middlesbrough - was appointed as player- manager at Oakwell on 6 July.
However, with Barnsley out of the running for promotion and also safe from relegation, the board decided to dispense with his services.
The club issued a statement, saying: "The directors of Barnsley Football Club wish to announce that the contract of manager John Hendrie has been terminated.
"The board wish to place on record their thanks to John for his efforts in his two and a half years and particularly those as a player in the 1996-97 season.
"The search for a new manager starts immediately and in the interim Eric Winstanley has been placed in temporary charge."