Leeds United want to instigate talks with Celtic's Martin O'Neill about becoming their next manager after sacking David O'Leary yesterday. Peter Ridsdale, the Leeds chairman, has identified O'Neill as his first choice to be O'Leary's successor, although the Yorkshire club are also acutely aware that there is no guarantee they will be able to lure him back to the Premiership.

At his home in Harrogate last night, O'Leary fired a parting shot in the club's direction by accusing them of having already lined up his replacement.

"I think I know who has the job," he said. "That's already in place."

Leeds, however, are insisting their search for a successor will start in earnest today. Ridsdale's first move will be to investigate whether O'Neill, who was the board's original choice for the job when O'Leary got it in 1998, can be prised away from Celtic. It will be by no means an easy task as O'Neill has re-established them as a force in Scottish football, but he has yet to sign a new contract there and financial troubles at Celtic mean that his transfer budget is likely to be restricted.

If O'Neill elects to stay, Ridsdale is likely to try to hijack Guus Hiddink's proposed move to PSV Eindhoven, or turn to the Republic of Ireland manager Mick McCarthy, or Alan Curbishley, who has impressed at Charlton.

However, the Football Association of Ireland (FAI) was quick to insist that it was not about to lose its manager following O'Leary's sacking. John Delaney, treasurer of the FAI, dismissed speculation that McCarthy would return to club management with Leeds United.

"Mick is contracted to the FAI until 2004 and his greatest wish is to lead his young team to the European finals in Portugal," he said. "We have no doubt that he will stay on board."

Leeds said in a statement yesterday that they hoped to make an appointment within the next few weeks.

O'Leary's sacking prompted angry scenes outside Elland Road last night, with fans barracking Ridsdale as he was driven away.

The Dubliner was told that the decision had been made because of his side's chequered form since the turn of the year, their non-qualification for the Champions League in the last two seasons and his failure to justify a recruitment programme totalling almost £100 million (€154 million).

However, it emerged last night that a key reason for Ridsdale terminating O'Leary's contract was a dramatic loss of confidence from his players. Board members at the club had become aware that the manager had become unpopular with several of his squad, and their suspicions were confirmed in a number of confidential calls made by Ridsdale to top players.

The players in particular cited a perceived lack of man-management skills. This convinced Ridsdale that O'Leary's chances of bringing success to Elland Road next season had sharply diminished. Not one was willing to give their unequivocal support to the manager, with stories emerging that some were considering their futures if he stayed.

O'Leary's column in the Sunday People newspaper last weekend stung the board into action. In it O'Leary said he had advised the board not to sell Rio Ferdinand, who is the subject of interest from Manchester United, and that any club that sold a player of his quality could not expect to qualify for the Champions League.

The directors believed that in private O'Leary had reluctantly recognised that Leeds' financial situation necessitated Ferdinand's sale and were incensed by the remarks. They called a board meeting on Tuesday and decided that they would not tolerate an employee criticising company policy in the national press.

O'Leary was summoned to see Ridsdale yesterday at 11.0 a.m. and told of his fate in a meeting that lasted no more than five minutes. Leeds will honour a clause in O'Leary's contract stipulating that, if sacked, he receives a year's wages of £1.2 million in compensation.

There had been mounting dissatisfaction at O'Leary's performance at the club and, unbeknown to the manager, the Leeds board discussed his future in May.

O'Leary's decision to publish Leeds United on Trial directly after the end of the trials of two of his players, Lee Bowyer and Jonathan Woodgate, also raised eyebrows at the club where it was thought he could be perceived as profiting from the case. The book also damaged relations with his squad, who felt that O'Leary was unfair and indiscreet in the book.

At that stage Ridsdale and his colleagues agreed to give O'Leary more time, deciding that they would reassess the situation in October if they had a poor start to the season.

However, Ridsdale felt compelled to think again because of what the players told him and his intense sense of irritation about the perception of the club's financial situation that O'Leary has created during several recent interviews.

A senior club source said: "David was given everything he wanted by the board. He has done some tremendous work for the club, built a great squad and we are very thankful. But after the events of the past 18 months or so, it was the right time for a change. Someone else is needed to take the club to the next level."