McDonald joined the Selhurst Park staff as Dowie's right hand man a year ago after five years service as a coach with the Wanderers but he will now be looking for alternative employment after Dowie joined up with Palace's arch rivals Charlton Athletic a few days ago.
The chirpy 40-year old Geordie first came to Bolton as a player in the summer of 1994 but a broken leg against Bristol City in only his second game for the club hampered his progress as the Trotters made their way into the Premiership for the first time.
Meanwhile John Sheridan, a member of the successful 1997 promotion winning team, is the new manager of Oldham Athletic following the departure of Ronnie Moore in midweek.
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