The Bombers have played under a cloud of uncertainty thrown up by their battle with ASADA and WADA over their supplements scandal and mismanagement in 2011 and 2012.
The club currently has 20 players awaiting the re-hearing of anti-doping charges in the Court of Arbitration for Sport upcoming in November.
The movement to have Hird, 42, stand down reached its climax on the weekend, with the Bombers suffering a 112-point loss to Adelaide.
There have been reports that Hird and the Essendon board were in talks on Monday night and early on Tuesday morning, which saw Hird agree to stand down with a year remaining on his current contract.
The Bombers sit 15th on the premiership ladder with just five wins in 2015, and have been criticised for a number of shocking performances throughout the course of the season.
Reports suggest that Matt Egan has been appointed the interim coach of the Bombers for the remaining three weeks of the season.
Hird is expected to be paid out for the remaining year on his contract - a figure which is estimated to be about $750,000.
It does prove you can do almost anything in sport...except lose. #Hird
— Richard Hinds (@rdhinds) August 18, 2015
Hird agreed an hour and half ago to the board's decision last night to sack him. Will be a pay out.
— Mark Robinson (@Robbo_heraldsun) August 18, 2015
A lawyer reacts to news of James Hird's sacking. pic.twitter.com/AkOg4UO0HV
— Titus O'Reily (@TitusOReily) August 18, 2015
BREAKING: James Hird parts ways with @EssendonFC http://t.co/WA6lcujAGA #AFL pic.twitter.com/Kee8nfRbXZ
— Sportal (@SportalAU) August 18, 2015
Thankfully Hird had the good sense to leave before he damaged the Bombers' reputation
— Alex McClintock (@axmcc) August 18, 2015
Odd feeling with #Hird. Should have happened two years ago. But sad the whole thing happened at all.
— Richard Hinds (@rdhinds) August 18, 2015
Whoa. Reports Essendon have sacked Hird again.
— Richard Hinds (@rdhinds) August 18, 2015
BREAKING: Hird has allegedly resigned from @EssendonFC. #FootyClassified
— Footy Classified (@FootyClassified) August 18, 2015
BREAKING: @EssendonFC to hold a press conference at 3.15, where it is expected they will announce James Hird's exit. pic.twitter.com/zrXAYpIAu2
— FOX FOOTY LIVE (@FOXFootyLive) August 18, 2015