The Wearsiders are looking for their first win of the season, having parted company with the Italian after a disastrous start, but will be tested by the flying Posh
They made the move on Sunday night after taking just one point from their opening five games to leave them bottom of the Premier League table.
A statement on the club's official website confirmed: "Sunderland AFC confirms that it has parted company with head coach Paolo Di Canio.
"Kevin Ball will take charge of the squad ahead of Tuesday night’s Capital One Cup game against Peterborough United and an announcement will be made in due course regarding a permanent successor.
|CAPITAL ONE CUP LATEST
|9/2||Peterborough are 9/2 with Bet365 to beat Sunderland
Ball takes charge of a side who sealed their place in the third round with a 4-2 win over MK Dons after scoring four times in the final 12 minutes to overturn a two-goal deficit.
Sunderland beat Peterborough 2-0 in the FA Cup back in January 2012 when the two sides last met, with Sebastian Larsson and James McClean on target at London Road.
But the League One outfit have been in impressive form so far in the competition, dispatching Colchester United 5-1 in the first round before thumping Championship side Reading 6-0 at London Road in the second round.
Midfielder Lee Tomlin scored a brace at Colchester before going one better with a hat-trick in the win over Reading to make him the competition's top scorer.
And boss Darren Ferguson, whose side beat MK Dons on Saturday despite being reduced to nine men, believes that a similar performance to the display against Reading could see them cause an upset at the Stadium of Light.
"It is a Premier League team and I fully believe if we play to our full potential and how we performed against Reading then we have a good chance," he said, speaking prior to Di Canio's sacking.
"Sunderland are a good side though, they are at home and will want to progress. It is what it is and we look forward to the opportunity of going to the Stadium of Light."