Club president Florentino Pérez, vice-president Emilio Butragueño and director of football Arrigo Sacchi delivered the news to Luxemburgo following a meeting on Sunday afternoon. López Caro, 42, has been coaching Madrid's B team - Castilla - whom he led to promotion to the Segunda División last season, but he now takes over first-team affairs until a permanent appointment is made.
Explaining Madrid's decision to part with Luxemburgo and his four assistants last night, Butragueño said: "It wasn't an easy decision, but the board considered that we had reached a point where we needed a change.
The team were not living up to expectations and that worried both us and the fans and that was the fundamental reason for our decision, which was unanimous."
Time ran out for the 53-year-old Luxemburgo after Saturday's lacklustre 1-0 home win against Getafe CF. Madrid have struggled for form of late, with the low point being last month's 3-0 home defeat by FC Barcelona, when Madrid supporters jeered their players while applauding the visitors.
Luxemburgo had succeeded Mariano García Remón in December 2004, becoming the club's fifth coach in two and a half years. Vicente Del Bosque was sacked in 2003 and replaced by Carlos Queiroz. Former Spain boss José Antonio Camacho was subsequently installed at the start of last term but walked out after three league games, leaving assistant García Remón holding the reins.
Luxemburgo impressed in his first months at the helm, steering Madrid to a second-place finish in the Primera División, four points behind champions Barcelona. The club then invested around €90m in summer signings, including Brazil forwards Robinho and Julio Baptista, Uruguay duo Pablo García and Carlos Diogo, and Spain defender Sergio Ramos.
Off the pace
However Madrid, without a major trophy since the 2002/03 league title, lie fourth in the table with 25 points from 14 games, six behind leaders Barcelona who won 2-0 at Villarreal CF on Sunday when second-placed CA Osasuna triumphed at Málaga CF. Madrid next play on Tuesday when they visit Olympiacos CFP in the UEFA Champions League, having already qualified for the knockout rounds.
©UEFA.com 1998-2013. All rights reserved.