Team owner Jerry Jones decided enough was enough following a 45-7 loss to the Green Bay Packers the night before. It was the Cowboys' fifth straight loss, dropping them to 1-7.
"We are grateful to Wade and his contribution to the Cowboys, leading us," Jones said. "We also clearly understand we are not where we want to be at this time, and that's an understatement. We share the responsibility - all of us."
This is the Cowboys' worst season since 1989 and among the worst in franchise history by record alone. Realistically, it's the low point considering Dallas was coming off a division title and a playoff win, and was expected to contend for the Super Bowl that'll be held at Cowboys Stadium.
Phillips' departure takes another dubious spot in club history: the first in-season coaching change.
"An in-season changing is something I was reluctant to consider," Jones said. "I recently addressed the team and my comments with them were very brief and pointed. I told them they should not think this an admission of defeat or finality in this season.
"We have eight games left and we have one goal -- to win."
The first game under Garrett will be at the New York Giants on Sunday.
"He does have the opportunity to get the job long-term," Jones said. "I do believe Jason has the temperament and disposition to affect a culture change.
"I think this is important. We know men's styles are different. His style, I think is one that can be effective."
In addition to Garrett as interim coach, Paul Pasqualoni has been moved to defensive coordinator.
Just about everything has gone wrong this half-season. The constant has been mindless mistakes: penalties, turnovers and other breakdowns befitting an expansion team, not one of the highest-paid rosters in the NFL. Phillips couldn't get them to snap them out of it. He tried being loyal instead of benching the guys who were underperforming the most. That only seemed to make things worse.
The bottom has fallen out since quarterback Tony Romo broke his left collarbone Oct. 25. Maybe that was to be expected, except that the defense has been the bigger problem.
That unit has allowed at least 35 points in three straight games, something the Cowboys hadn't done since their inaugural season, 1960, when they went 0-11-1. Stranger still, it's almost exactly the same guys who closed last season with the first back-to-back shutouts in club history. This may have been Phillips' undoing because he also was defensive coordinator.
Jones had steadfastly supported Phillips throughout this tailspin, even saying late last week that Phillips would keep the job the rest of the year. The first five losses had all been by a touchdown or less, which showed players were still fighting. But a second straight humiliating loss left Jones with little choice. Something had to change to spark interest in the final eight games.
"I'd change my mind from as late as Saturday. I don't like the way that looks stability-wise, organization-wise," Jones said of a midseason move. "I think it called for it and I recognized after the game that we just weren't playing winning football or our best chance at winning football. I don't apologize for changing my mind."
Garrett's unit hasn't been much better, but he's been viewed as the coach-in-waiting since he was hired -- days before Phillips.
Garrett, 44, becomes the first former Cowboys player to become head coach. He was a backup quarterback behind Troy Aikman from 1993-99. He was the quarterbacks coach in Miami in 2005-06 before rejoining the club in 2007. He's had the title of assistant head coach since 2008, when he withdrew from other interviews to remain with the club.
His father was a longtime scout for the Cowboys and he has two brothers on his staff: tight ends coach John and Judd, the director of pro scouting.
The 63-year-old Phillips would leave with a 34-22 record over 4 1/2 seasons guiding the Cowboys. He also was 1-2 in the postseason. Dallas won the NFC East twice on his watch.
His career record as a head coach with Dallas, Denver and Buffalo is 79-57, but only 1-5 in the postseason. He had only one losing record in eight full seasons. Counting a 3-4 mark over two stints as an interim coach, Phillips has 82 regular-season wins, matching the total of his father, former Houston and New Orleans coach Bum Phillips.
Phillips' job was shaky after a 44-6 loss to Philadelphia to close the 2008 season kept them out of the playoffs, and again last season when the Cowboys appeared headed toward a collapse in early December and Philllips' contract was expiring. But they pulled out of it so impressively that Phillips received a contract for this season and next. He's owed at least $3 million for 2011.
It's quite possible this will be Phillips' final turn as an NFL head coach, although he could resurface as a defensive coordinator, his specialty throughout a 34-year career in pro football.
This year, the defense couldn't stop the run (routinely allowing 100-yard rushers, something they didn't even do once last season) and was helpless against the pass, offering neither a rush nor good coverage.
The offense wasn't clicking even when Romo was healthy. The problems stem from an offensive line that consistently seems overmatched whether it's trying to open holes for running backs or protect the quarterback. The backfield trio of Marion Barber, Felix Barber and Tashard Choice hasn't done much even when the holes were there. The lasting image of the receivers this season is of balls ricocheting off them and into the hands of defensive players.
Even the special teams have been a disappointment.
Dallas has been solid covering punts, but struggled to stop kickoff returns, another oddity because many of the same guys are on both units. Teams are taking advantage of the weakness, too. When David Buehler booted a kickoff 6 yards deep to start the second half against Green Bay, the Packers returned it anyway -- and took it nearly to midfield.
The Cowboys have tried nearly every trick in the turnaround handbook -- a players-only meeting; an emotional speech from special teams coach Joe DeCamillis about nearly being killed when the team's indoor practice facility collapsed; a speech by Jones last week; a change in practice schedule; and, this past week, a return to fundamentals.
So now Jones is trying pretty much the only thing left.
Speculation will persist on the club's next permanent leader. Obvious candidates include former Super Bowl winners Bill Cowher and Jon Gruden, both working in broadcasting.