John Terry was sacked as England captain today after a brief meeting with coach Fabio Capello, said the Football Association (FA).
The Chelsea defender, who was first made full-time skipper in 2006 by former coach Steve McClaren, has been the subject of intense media speculation following allegations about his private life.
"After much thought I have made the decision it will be best for me to take the captaincy away from John Terry," Capello said on the FA website (www.thefa.com).
"As a captain with the team John Terry has displayed extremely positive behaviour. However, I have to take into account other considerations and what is best for all of the England squad.
"What is best for all of the England team has inspired my choice," added Capello.
The Italian retained Terry as skipper when he took the England job in 2008 after the sacking of McClaren and since then the team have flourished, qualifying easily for the World Cup in South Africa in June.
However, married father of two Terry's suitability to continue in the high-profile role has been questioned after the recent damaging media coverage.
Terry must play against Arsenal, says Chelsea coach
Chelsea coach Carlo Ancelotti said he never considered leaving out John Terry for this Sunday's big game against Arsenal because of his off-the-field problems.
"John has to play against Arsenal because he's one of the most important players in the team and we need to put strength and quality in the team," Ancelotti told reporters on Friday before the FA announced Terry had been stripped of the England captaincy.
The Chelsea defender was sacked as England skipper by international coach Fabio Capello following intense media speculation over Terry's private life.
Capello's fellow Italian Ancelotti said it had been business as normal this week as Premier League leaders Chelsea prepared to host third-placed Arsenal.
"Nothing is different about the last week," said Ancelotti. "The problem involving John is outside our training ground.
"It's normal life for us. It's an important game against a strong team and I think we will be ready to play our best game."
Ancelotti said he was surprised at the level of media interest in married father of two Terry.
The 29-year-old defender's private life would never have caused such a stir in Italy, said the Chelsea coach before adding he would not interfere with the situation over the England team.
"I'm not interested in Capello and John Terry," said Ancelotti. "It's not my problem.
"John is focusing on his job. He is doing very well every day, every moment. He's the captain of this team and he's doing his best for the team. He's been playing well the last two games, he scored at Burnley (last Saturday).
"It's his private life and I don't want to know nothing about this. I'm interested only in his professional behaviour and his professional behaviour is the best," said Ancelotti.
"Some coaches phone players at home to check on them. I have never done this. I'm interested in the players on the training ground and controlling their behaviour only at the ground."
Chelsea, who beat Arsenal 3-0 at the Emirates Stadium in November, are six points ahead of their London rivals and two in front of Manchester United.
Arsenal lost 3-1 at home to United last weekend and face a Chelsea team unbeaten at home for more than a year.
Ancelotti's only injury absentee is versatile Brazilian Juliano Belletti.
Didier Drogba, who has scored 10 goals against Arsenal in nine starts and two substitute appearances since joining Chelsea in 2004, is likely to partner Nicolas Anelka up front.