South African Arthur was dumped after a meeting with Cricket Australia chief executive James Sutherland in Bristol, reports said. A source confirmed the news to AFP.
"Cricket Australia will hold a media conference with James Sutherland and (high performance coach) Pat Howard in Bristol tonight to discuss the coaching structure of the Australian team," Cricket Australia said in a statement.
Reports said Queensland coach Lehmann, who is in England coaching Australia A, would replace Arthur, 45, whose contract was due to run until the end of the World Cup in March 2015.
Sutherland was furious and demanded the team crack down on bad behaviour.
Warner was fined AUD 11,500 and suspended until the start of the Ashes series for punching England batsman Joe Root in a Birmingham bar during the Champions Trophy.
Several others players were with him in the bar in the early hours of the morning, raising concerns about the culture inside the Australian squad
Arthur, whose Test record since taking over was 10 wins, six losses and three draws, courted controversy by sending the players home midway through the series.
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