The former Arsenal midfielder had guided the Royals into the Premier League as Championship title winners just a year after missing out on the top flight to Swansea City in the playoff final at Wembley.
McDermott had succeeded Brendan Rodgers at the Madejski Stadium in 2009 in an interim role before being appointed as the full-time manager of the club.
However, the demands of remaining in the Premier League and reaping the associated riches have been too much for owner Anton Zingarevich and the Russian has joined another more famous oligarch in sacking a manager who has brought success to the club.
What the new Russian owner may not fully realise, like his counterpart at Southampton Nicola Cortese, who dismissed Nigel Adkins in January, is that these are still halcyon days at the club.
The Royals might have spent two seasons in the top flight between 2006 and 2008 when Steve Coppell was in charge, but matches against the likes of Manchester United and Chelsea were previously confined to irregular cup ties.
With McDermott gone, the name of Paolo Di Canio has surfaced as the favourite to take over at the Madejski, but is he the right man for the job?
The former Celtic and Sheffield Wednesday midfielder left Swindon last month after falling out with the new owners at the County Ground.
Di Canio has a notoriously short fuse, as he proved in the infamous push on referee Paul Alcock during a Premier League match against Arsenal at Hillsborough in 1998.
And former Swindon chief executive Nick Watkins outlined the Di Canio style of management in an interview with BBC Radio Wiltshire last week:
Often I refer to it as management by hand grenade. Paolo would chuck a hand grenade and I would do the repair work at the end, like the Red Cross.
The sight of Di Canio, who was in sight of a second successive promotion with the Wiltshire club, in the Reading dugout may amuse some Madejski supporters, whose rivalry with Swindon remains a fierce one.
However, the ex-Lazio man is still too much of a risk if the Royals have axed McDermott in order to secure their top-flight status.
The Italian was immediately touted as a potential West Ham manager when Sam Allardyce leaves Upton Park, although some mischievous supporters would have been asking for Di Canio to take over straight away.
West Ham co-owners David Gold and David Sullivan have more than enough business sense to recognise a popular choice, but Allardyce has provided a solid grounding for the club in the Premier League and the Upton Park hierarchy also realise stability is required to maintain the Hammers' presence in the top flight.
Without doubt, Di Canio would ignite the Madejski, but he remains untried at the top level and Zingarevich can only be focused on survival with the dismissal of McDermott nine games before the end of the season.
If the Royals are to remain in the Premier League, they need experience. Former Charlton and West Ham manager Alan Curbishley is a possibility, but he has not worked since leaving Upton Park in September 2008.
Former Chelsea boss Roberto Di Matteo and ex-Southampton manager Nigel Adkins would also fit a template for long-term roles, while Steve McClaren has returned to England after leaving FC Twente.
Wolves sacked Mick McCarthy ahead of crucial matches at the foot of the table and were then promptly relegated. They are currently battling for Championship survival after replacing McCarthy with inexperienced Terry Connor for the remainder of the campaign last season.
Newcastle, of course, drafted in club legend Alan Shearer (BBC Sport) after Joe Kinnear fell ill towards the end of the 2008-09 season. The Tyneside club slid into the Championship and Shearer exited, leaving Chris Hughton to drag them out of the second tier at the first time of asking.
Reading and Zingarevich must be wary that a similar fate does not become them. Di Canio is still too much of a maverick for Reading to take the gamble.
Zingarevich may well miss out on the lucrative television contract available next season by failing to hire the right man to keep Reading in the top flight: Brian McDermott.
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