Here, we are take a look at some of the main incidents.
January 8, 2011: Is called back from a holiday to take temporary charge of Liverpool after the departure of Roy Hodgson.
April 11: Beats high-flying Manchester City 3-0 at Anfield.
May 12: Having arrested the club's alarming slide, signs a three-year contract to become permanent manager for a second time.
October 1: Records a 2-0 Merseyside derby victory at Goodison Park.
November 29: Win over Chelsea at Stamford Bridge puts Liverpool into Carling Cup semi-finals.
January 25, 2012: Draws home leg of Carling Cup semi against Manchester City to progress to Wembley on aggregate score.
February 26: Ends Liverpool's six-year trophy drought with penalty shoot-out victory over Cardiff in Carling Cup final.
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January 9, 2011: Loses first game at Manchester United in the FA Cup third round.
January 12: Suffers first league defeat at Premier League newcomers Blackpool.
January 31: Loses Fernando Torres to Chelsea for record £50million fee after star striker hands in transfer request.
March 17: A goalless draw at home to Braga sees Liverpool exit Europa League at last-16 stage.
May 22: Defeat at Aston Villa sees Liverpool finish sixth, 10 points adrift of Champions League qualification.
November 10: Labels Football League "disgraceful" for not allowing Liverpool to reschedule a Carling Cup quarter-final at Chelsea to avoid playing two matches in three days, and threatens to play the youth team.
December 8: Describes Football Association handling of Luis Suarez racism charge as a "joke".
December 21: Incurs widespread criticism for joining players by wearing a T-shirt in a show of support for Suarez, who had been accused of racially abusing Manchester United's Patrice Evra.
February 12 2012: Publicly apologises for "conduct not befitting of a Liverpool manager" during a television interview after league defeat at Manchester United.
May 5: Loses FA Cup final 2-1 to Chelsea.
May 14: Loses final match of season at Swansea before flying to the United States to meet the club's owners.
May 16: Contract is terminated by Fenway Sports Group.