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Assistants Peter Horachek and Steve Spott will handle coaching duties for Wednesday's home game against Washington, the Leafs said.
Toronto (21-16-3) has lost seven of its last nine games and went 2-5-0 on a dismal road trip that ended with a 5-1 loss at Winnipeg on Saturday.
The Leafs were riding high with six straight wins before the current skid, but are now just one point ahead of Boston for the final wild-card playoff position in the Eastern Conference.
“I want to thank Randy for all of his hard work and dedication,” said general manager Dave Nonis. “It’s never an easy decision to make when changing your leadership but our team was not trending in the right direction and we felt an immediate change was necessary.”
Hired in March 2012, Carlyle coached Toronto for parts of four seasons and compiled a regular-season record of 91-78-19. He guided the Leafs to the playoffs in the lockout-shortened 2013 season, but Toronto lost its first-round series to Boston after collapsing late in the seventh and deciding game.
The Leafs fell apart at the end of last season, losing 12 of their last 14 games to miss the playoffs for the eighth time in the last nine years.
Carlyle's job looked to be in jeopardy at the time, but new president Brendan Shanahan elected to retain him and Nonis upon taking over in April.