MK Dons manager Karl Robinson is the early favourite to be installed as Nottingham Forest's next manager after Steve McClaren quit on Sunday night.
Both McClaren and chairman Nigel Doughty resigned after Forest threw away the lead and lost 3-1 at home to Birmingham.
The former Middlesbrough and England boss left the club after less than four months in charge, with Forest - who were widely fancied to be promoted this season - just one point above the relegation zone.
A club statement read: "Nottingham Forest can confirm that Steve McClaren has resigned from his role as manager.
"He has left the club without compensation – nor will he be seeking any. The club can confirm that the search for a new manager will begin immediately.
"Mr Doughty has also announced his intention to step down as chairman of the club at the end of the season after 10 years in the role. The search for a new chairman will commence immediately."
Bookmakers Victor Chandler on Monday morning made Robinson their early favourite.
VC spokesperson Charlie McCann told Crunchsports.com: "Young MK Dons boss Robinson is our early market leader at 16/5 although former Southampton, Wolves and Cardiff boss Dave Jones has also been popular in the early exchanges and is now 5s from 8s.
"Forest legends Martin O’Neill (7/2) and Roy Keane (15/2) are sure to have their supporters but will the City Ground be the challenge O’Neill has been waiting for since turning his back on Villa?"