Bilic took over at Vicarage Road in September with the club sitting 10th in the Championship.

He and his coaching staff leave the former Premier League club in ninth place but four points off the playoff places and with just one win in their last eight league matches.

Sky Sports television said former Sheffield United and Middlesbrough boss Chris Wilder was set to take over for the rest of the season.

"We are all ambitious to succeed this season, so something new is needed quickly while the opportunity of promotion is still real," Watford technical director Ben Manga told the club website.

"With the January transfer window over, to change coach is the only option available to re-energise for the final games ahead."

Bilic previously managed West Ham United and West Bromwich Albion in the Premier League and is the 18th permanent Watford manager to lose his job since the Italian Pozzo family took over the club in 2012.