Leeds sell Ferdinand, Woodgate and the rest, and go down two years after O'Leary

On 27 June 2002 Leeds United announced that David O'Leary was leaving. "After four successful years the pressures of some of the off-field incidents have resulted in both the company and Mr O'Leary agreeing that it would be of mutual benefit for a change of manager," said the club's statement.

O'Leary told it differently. "I went in this morning thinking I've got my holiday during which to organise things for next season," he said, "and the chairman told me 'you've got the sack'." It started a public row with Peter Ridsdale. Leeds had been top of the league on New Year's Day and finished fifth, out of the Champions League for a second season, and O'Leary was said to have lost the dressing room. Ridsdale cited his book, "Leeds United on Trial", as one of the reasons.

On 8 July Terry Venables took over on a two-year contract. Ridsdale said people in the game were "almost unanimous in their verdict that Terry is the best coach and manager in the game".

The loan

The club had borrowed £60 million against its future gate receipts. The repayments depended on money from the Champions League, and Leeds had now missed it twice. To keep up with the repayments, the club had to sell players.

The first to go was the captain. Before the end of July Rio Ferdinand was sold to Manchester United for about £30 million, a British record. "I'm not happy as a Leeds fan because I didn't want him to leave," said Ridsdale. "But when your captain says he wants to leave you have to listen, and I think we've got the best price available." He added: "People need to look at how much we've invested in the last three or four years. We're hardly a selling club."

At the end of August Robbie Keane went to Tottenham Hotspur for £7 million.

January

That winter the sales went on. In January 2003 Lee Bowyer left for West Ham United for a nominal fee. Robbie Fowler, bought for £11 million in November 2001, went to Manchester City, and Leeds carried on paying part of his wages. Olivier Dacourt went to Roma on loan.

Venables had threatened to leave if Jonathan Woodgate was sold. On 31 January Woodgate was sold to Newcastle United. "I was assured if Robbie Fowler went, Woodgate wouldn't go," said Venables. Ridsdale gave the reason: "We have lost £30m over the last two seasons through not being in the Champions League."

On 21 March Venables left and Peter Reid took over. By the end of the month Ridsdale had stepped down as chairman, replaced by Professor John McKenzie, and in April he left the board altogether. "Peter has other business interests that he wishes to pursue," said McKenzie, "and we have agreed that it is in the best interests of both parties that he stands down from the board of Leeds United and of the football club."

Leeds stayed up. On 4 May they won 3–2 away to Arsenal, the last league defeat Arsenal suffered before their 49-game unbeaten run, and finished 15th.

The goldfish

After Ridsdale left, McKenzie accused him in public of reckless financial behaviour, and described the club he had taken over as "an oil tanker heading straight for the rocks". Ridsdale said the new chairman had exaggerated the number of company cars. Then there were the goldfish. "When it came out that we were spending hundreds of pounds on goldfish," one fan said later, "you wondered what was going through his mind."

Ridsdale answered it in 2007. "To suggest the biggest single mistake I made – and I made plenty – was to have two goldfish tanks, which cost £200 per annum, was just laughable," he said. "I do not believe Leeds would be in League One if I had stayed."

Going down

In July 2003 Harry Kewell was sold to Liverpool. By November Leeds were bottom of the Premiership, and on 8 November they lost 6–1 at Portsmouth. Two days later Reid left by what the club called mutual agreement. "The recent run of results has been unacceptable," the board said. "The board therefore concluded it has a duty to act now." Eddie Gray took over as caretaker.

On 4 December Leeds signed a standstill agreement with their main creditors, including the holders of £60 million of senior secured notes, which kept them out of administration while they looked for investors or a buyer.

On Sunday 2 May 2004 they went to Bolton Wanderers. Mark Viduka scored a penalty and was then sent off. Youri Djorkaeff scored twice, Kevin Nolan once, and Ian Harte put one into his own net, and Bolton won 4–1. Leeds were six points from safety with two games left, and their goal difference meant it was as good as over. They finished 19th and were relegated.

In the summer Alan Smith went to Manchester United, James Milner to Newcastle United, Viduka to Middlesbrough and Paul Robinson to Tottenham.

Epilogue

Leeds did not come back up. On 4 May 2007, with one game of the season left, the club went into administration, and the ten-point penalty that came with it confirmed their relegation to League One, the third tier. The Football League then deducted another 15 points for the following season, ruling that Leeds had not followed its rules on administration.