The announcement by Cavaliers general manager Koby Altman came after Indiana beat Cleveland 119-107 on Saturday, with associate coach Larry Drew being promoted to interim coach.
“This was a very difficult decision,” Altman said. “It is especially so, considering Coach Lue’s time with us over the last four years, including four straight trips to the NBA Finals.”
Former associate coach Lue took over the LeBron James-led Cavs in January 2016 after the mid-season firing of David Blatt and guided Cleveland to its first NBA crown.
But James departed in the off-season for the Los Angeles Lakers, and little was expected of the Cavs this season.
“We have respect and great admiration for Ty, not only as a coach, but a person,” Altman said. “We thank him for the many ways he has contributed to our success, wish him the best and he will always be remembered for leading a very special Cavs team back against the odds to win the title in 2016.”
“This is a different team equation, though, and one that we felt needed a different voice and approach that required this change.”
James tweeted his appreciation for Lue on Sunday afternoon.
“T Lue thanks for the memories and more importantly our partnership bringing a (trophy) to that deserved city/fan base. U know how to find me,” James tweeted.
Lue, 41, went 128-83 in just over two and a half seasons as the Cavaliers’ coach, with a 41-20 record in the playoffs.
But with James gone, not even three consecutive trips to the finals in his first three seasons as coach could save Lue. The Cavs have not led this season in the second half and are off to their worst start since 1995.
In a statement to ESPN, Lue thanked Altman, former Cavs general manager David Griffin, and team owner Dan Gilbert.
“My time here in Cleveland was truly special,” Lue said. “I am very grateful for the dedication, sacrifice, and support of all the players on our team, the tremendous coaches I worked with, and of course, our incredible fans.”
“Lastly, deep thanks to Dan Gilbert, David Griffin, and Koby Altman for the opportunity over the last three years, and I only wish the organisation success moving forward.”
Drew, 60, has a 143-169 record as an NBA coach in three seasons with the Atlanta Hawks from 2010 through 2013 and the 2013-14 campaign with the Milwaukee Bucks. He joined the Cavs’ staff in 2014 after the Bucks hired Jason Kidd as their coach.
Drew went 8-1 last season guiding the Cavs while Lue was out with an illness.