Di Matteo has become the first top-flight manager to leave his post this season.
He took charge of Chelsea in March after the club had sacked Andre Villas-Boas. Initially Di Matteo took over on a temporary basis.
He rescued the club's ailing Champions League campaign and steered them against all odds to victory over Bayern Munich in the final on the German team's home ground, having already secured the FA Cup.
He was given a two-year contract in June but not before there had been speculation over whether Guardiola would take over.
The season started well domestically but they have fallen slightly off the pace in recent weeks.
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This is Gordon Hill. But you may know him by now as the Wealdstone Raider.