Birmingham have parted company with manager Lee Clark following a poor start to the Sky Bet Championship season.
Blues are one place outside the relegation zone having won just two of their 12 league games so far, and only retained their second-tier status in the final seconds of the last campaign.
A statement on the club's official website read: "Birmingham City Football Club has parted company with Lee Clark and Steve Watson with immediate effect.
"The search for a successor has already begun and the board will look to make an appointment in the very near future."
Clark, who was appointed to the St Andrews' hotseat in June 2012, has overseen just one home win since October 1, 2013, but vowed to carry on with the fight prior to his exit.
Speaking at a pre-match press conference on Monday, previewing Blues' trip to Blackburn on Tuesday night, the former Huddersfield manager said: "I'm definitely not walking away, no chance. This is a big club, I love working for it and I am proud to be the manager.
"There have been a lot of tough days and I haven't put up with that for over two years just to walk away.
"I've got to come out fighting for myself because there's no one else doing that at the moment. There's some unnecessary criticism of what's happening
"I'm not after a kiss and a cuddle - maybe from the Mrs - and supporters are within their rights to boo but it's easy to boo when you lose.
"I understand I am not flavour of the month with the supporters and a lot of them would like to see someone different, but I'm not too sure if things would change. I think I'm getting everything out of the players."
First-team coach and chief scout Malcolm Crosby will take charge of the squad that travels to Ewood Park.
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