His season was marked by an unpopular decision to bench David Beckham after the midfielder signed with the MLS' Los Angeles Galaxy.

"A major fault of mine was not to recognize Beckham's potential," Capello said after winning the league title.

The dismissal was widely expected, and Madrid's sports director Predrag Mijatovic said the decision came at a board meeting today.

Capello, who had two years remaining on his contract, was on vacation. It is the second time he has been fired by Madrid immediately after winning the league title, the first time in 1997.

Mijatovic did not elaborate on the reasons for firing Capello, saying only that "we felt he wasn't the most suitable person to carry out what we plan to do" over the next couple of seasons.

"It was a difficult decision to take knowing that despite everything Fabio Capello had a good season. He has worked hard," Mijatovic said.

The team was hurt by poor goal scoring, underachieving performances at home and the loss of striker Ronaldo to AC Milan.