The strong bookmakers’ favourite for the job is Irishman Nigel Worthington, the former Leeds United and Sheffield Wednesday full-back.
The 51-year-old former Norwich City and Northern Ireland manager has been out of management since quitting his post as Irish chief in October 2011, but possesses the experience being sought by the York board, desperate for the Minstermen to avoid the unwanted tag of becoming the first Football League club to be relegated just a season after being promoted from the Conference.
Other leading candidates for the post are thought to include former Stevenage manager Graham Westley, who recently left Preston North End, and former Hull City boss Phil Brown.
The board made the decision to sack Mills shortly after Saturday’s 2-0 home derby reverse to Bradford City, which dropped York to 18th, four points above safety after no wins in their last 11 League Two matches.
Communications and community director Sophie Hicks told the Yorkshire Post that the decision to dispense with Mills – who earned his place in the club’s folklore last May when he led York to a famous FA Trophy and promotion double at Wembley in the space of eight glorious days – was taken with a heavy heart.
But it was something the board felt compelled to do as they seek to avoid relegation from the league, which would be “catastrophic”, according to Hicks.
On the decision to dismiss Mills, who had taken over as York manager in October, 2010, Hicks said: “We just felt our position was too precarious to ignore and felt as a board that sometimes you have got to take action, and that it’s better to do that than sit back and watch a situation continue.
“It would be catastrophic for us to lose our league status. As directors of this football club, we are custodians and we care. And when you care, somebody has to make difficult decisions.
“Our absolute priority is putting every effort into maintaining our Football League status.
“We are hoping to appoint a new manager fairly quickly; before our game with Wimbledon on Saturday certainly. We do want to bring someone in quickly to give them time to prepare. We have 10 games left and basically require 10 points.”
Mills spoke to the press shortly after the final whistle expressing his determination to battle on. But soon after he was told the news by the York board and was understood to be deeply upset.
Mills was contacted yesterday, but was unwilling to comment.
Hicks added: “It was a very, very tough decision. Gary leaves with a lot of thanks from the club. Gary had incredible success in May last year and it was a really hard call to make. But we had to make a decision as the bottom line is that we have got six points out of the last 33 and are four points off a relegation place.
“The four board members all delivered the news to Gary and, obviously, he was upset by the situation. It was just really, really unfortunate and it was with deep regret we came to this point.
“We are quite experienced as directors, having been at the club for 10 years and having been through this situation before. But in the case of Gary, we had a very close relationship and that made the decision even harder.”