Full story from sky news
Mick McCarthy has resigned as manager of Republic of Ireland.
The Football Association of Ireland said a compensation deal had been agreed between the organisation and McCarthy.
The move follows the dramatic World Cup spat between McCarthy and the team's former captain, Roy Keane.
The decision opens the door for Keane to return to the national side.
Preparations
McCarthy has lost his first two Euro 2004 qualifiers and has been under intense pressure since Keane's dramatic dismissal from this summer's World Cup squad.
Keane returned home from Japan and South Korea following a public bust-up with McCarthy before he had even kicked a ball in a tournament match.
In his autobiography Keane, the Manchester United captain said he was unhappy with the tournament training facilities and organisation, blaming McCarthy and the FAI set-up for the blunders.
But the disagreement ended in spectacular fashion when the two clashed in the team's hotel lobby in front of the other players.
'No respect'
Keane, writing in his autobiography, admitted he told McCarthy he had "no respect" for his manager, both as a player and as a boss.
Many Irish fans backed Keane over the incident and pundits agree that the team would have done better in the World Cup - and in the Euro 2004 qualifiers - with Keane in the side.
The Manchester Utd star vowed never to return to the Irish side while McCarthy was in charge.
McCarthy's resignation could now see Keane return, although it may not be until after Christmas because he is recovering from an hip injury. | 
