Mano Menezes was sensationally sacked as coach of five-time world champions Brazil on Friday, dealing a hammer blow to the misfiring hosts of the 2014 World Cup.
"I gave him the news myself," said Brazilian Football Confederation (CBF) national squad director Andres Sanches.
"Nobody likes to receive news of these kind of things in any circumstances, but everyone in football knows that these things happen. A new coach will be announced in January."
Menezes, 50, took over from Dunga following the team's elimination in the quarterfinals of the 2010 World Cup finals in South Africa.
But he had come under intense pressure after the team's failure at the 2011 Copa America, where they lost in the last-eight to Paraguay, and at the Olympic Games in London this summer where they finished runners-up.
Menezes, who was axed after a meeting with the CBF president Jose Maria Marin, oversaw 21 wins in his time at the helm, six draws and five defeats.
His job had been on the line since Brazil's latest attempt to win Olympic gold ended in humiliation after a lacklustre 2-1 loss to underdogs Mexico at Wembley in August.
Media speculation has already linked former Selecao boss Luis Felipe Scolari with a return to the hot-seat after he guided Brazil to World Cup glory in 2002.
Despite the setback at the Olympics, Menezes appealed to Brazil's football federation chiefs not to be panicked into sacking him.
"Any coach must be ready to suffer the consequences of their results," Menezes said.
"Even when teams win tournaments people (in Brazil) don't always praise the coach so imagine what it is like when you lose.
"But defeat in one match should not have a decisive influence. Had we won that would not have solved all of our problems either. Lessons must be learned from every match."
Menezes said he believed that the Olympic loss could have been used to inspire Brazil to a sixth World Cup on home soil in 2014.
"The important thing is the right corrections are made so the next time we can win," he said in London.
"You learn from defeats as well as victories."
Menezes had previously coached Brazilian club side Gremio from 2005 until 2007, leading the team to the final of the Copa Libertadores where they were defeated by Boca Juniors.
He then took charge of Corinthians with whom he won the 2009 Brazilian Cup.
While Scolari remains the favourite to take over, some reports have linked Corinthians coach Tite and Santos boss Muricy Ramalho with the job.