The Italian boss took training this morning then met club chiefs for talks with tensions around Vicarage Road high.
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The Hornets board had been made aware that a number of players would try to leave if Mazzarri remained in charge.
Mazzarri still hasn’t learnt English – he has continued to speak Italian in his press conferences – and that in itself has annoyed players. That, coupled with a lack of days off, has left the squad calling for Mazzarri to go.
Mazarri joined Watford in June having previously been in charge of Inter Milan. He has managed 40 games, winning 12, drawing seven and losing 21.
The 55-year-old signed a three-year deal last year – but will leave after just one campaign.
Chairman Scott Duxbury released a statement this afternoon which read: “After the board discussed with Walter Mazzarri the club’s future goals and aspirations, it was decided he will be stepping down from his position as the club’s head coach after the final game of the 2016/17 season.
“We thank Walter and his staff for the contribution they have made to Watford Football Club over the past year.”
Former Leicester boss Claudio Ranieri has been chalked up as the bookies’ early favourite to replace him.
Alan Pardew, Nigel Pearson (both 8/1) and Kenny Jackett (12/1) are also in the running.
There’s also the possibility Watford could move for Hull boss Marco Silva.
Sceptics slammed the decision to appoint Silva in January but he impressed during his five-month spell in charge of Hull.
Watford are 16th in the Premier League having lost 4-3 to Chelsea on Monday. They have taken just three points from a possible 21.
Spaniard Quique Sanchez Flores was sacked by Watford last summer – despite guiding the club to the FA Cup semi-finals and comfortably retaining their status in the top division.
Slavisa Jokanovic departed a year earlier after leading Watford into the Premier League.
Mazzarri was the seventh Watford manager hired by the Pozzo family since they bought the club in 2012.