Sven-Goran Eriksson will be sacked as Manchester City manager at the end of the season.

Thaksin Shinawatra, the club's controversial owner, has told Eriksson that he does not believe he is the man to take City forward and will look for a new manager in the summer.

Eriksson's future has been uncertain for some weeks but the news is likely to spark outrage among City's supporters, who have been impressed with the job the former England head coach has done since taking charge of the club last summer.

Tensions between the pair increased during a confrontational meeting in Manchester on Sunday morning and Eriksson has come to accept that his relationship with Thaksin is untenable, alhough he will not resign. Eriksson, who has two years remaining on his contract, can expect a pay off of around £2.5 million.

Despite the revelations, Eriksson is refusing to comment on the meeting, insisting he remains focused on the club's final two matches of the season.

"I had a meeting with Dr Thaksin and his people on Sunday morning and at this moment with two games to go in the season I don't want to make any comment about that," Eriksson said. "There are no more meetings planned until the season is over. I appreciate the backing of the fans which I have felt since the day I arrived. I thank them very much. But now we are just focusing on trying to beat Liverpool on Sunday."

The club echoed Eriksson's statement, claiming it was business as usual at Eastlands.

"Dr Thaksin Shinawatra recently stated that there would be a full review of the club at the end of the season," Paul Tyrrell, a spokesman for the club, said. "The situation remains the same. Sven-Goran Eriksson, the players, board and staff of the football club are fully focused on the two remaining games of the current campaign."

Although Eriksson has met Thaksin's objective of a top-ten finish this season, the owner is understood to have misgivings over some of the signings the Swede made last summer and does not trust him to spend another transfer budget wisely. He was also dismayed by some of the club's results and performances in the second half of the campaign.

"We will be here for the two last matches. They probably think that we haven't done a good enough job", Tord Grip, Eriksson's assistant, told Swedish newspaper Aftonbladet.

"We believe that we have done well, it's been harder after Christmas but that's how football works.

"Things always go up and down and the Premier League is like a marathon. It takes time to build a team.

"Sven will receive new offers soon I'm sure."

Eriksson's team occupied third place in the Barclays Premier League at the end of November, but Thaksin became increasingly disillusioned by the club's recent dip in form.

Athole Still, Eriksson's agent, said this morning that his client's position was increasingly uncertain.

"It's just developments over the last couple of days," Still said. "If Dr Shinawatra was going to give his ringing support we would have heard it over the last couple of days. That's the way that it's looking - believe me I don't know, I am just giving an answer and a reasonably-formed opinion - it's looking odds against."

City fans have voiced their support and Michael Ball, the former Everton defender, said yesterday that “every player is 100 per cent behind him. We like his methods, the way he trains, the way he goes about his tactics. If the club wants to go forward, we have got to keep the coaching staff and, obviously, add a few more players.”

"The whole thing is just ludicrous," said Dave Wallace, editor of the King of the Kippax fanzine. "For once, we thought we were in for a period of stability. It seems like it is anything but. There have been a few grumbles at recent results but we can all see how far the team has progressed. It just seems the owner is either being badly advised or he is just not listening.

"Fans are naturally going to worry about precisely who we are going to get," said Wallace. "How much money will be available for a start? That is a key question. "It is fair to say people had reservations about the new owner to start with but these will only be heightened now."