The Blues board are determined to sweep away the club's old guard and have decided the skipper no longer forms part of their long-term plans.
The decision has been taken as much for concerns over Terry's fitness as the controversy, which sees him serving a four-match ban for racially abusing Anton Ferdinand, the Daily Mirror reports.
According to the report, Terry's fellow Chelsea legend Frank Lampard  could also be leaving Stamford Bridge as soon as January.
Lampard, 34, was left on the bench at White Hart Lane yesterday and sent on as a 90th-minute sub in the 4-2 Chelsea win . No talks on a new agreement have been held, leaving him free to speak to overseas clubs in January, the report said.
Los Angeles Galaxy are preparing a bid for him which would see him heading to Major League Soccer for the start of next year's campaign in March. (ANI )