The President does not like his poll numbers.
Parscale's future had been in serious doubt for weeks.
A majority of registered voters (52 per cent) report they will support Biden in the general election, with 37 per cent opting for Trump, a wider margin than in Quinnipiac's June poll, when 49 per cent backed Biden and 41 per cent supported Trump.
Parscale and Trump have had an increasingly strained relationship in the past few months. Carlson, who became the most watched cable news host in history this year, is also one of the president's favorites.
Trump has repeatedly criticized Parscale in meetings over the turnout. But now Parscale will be demoted back to his original job.
Stepien has been in politics for years, working for former New Jersey governor Chris Christie and serving as Trump's national field director in 2016, the news channel said.
Mr Parscale, whom Mr Trump said would shift to a role focused on digital strategy, was blamed internally for the botched Tulsa, Oklahoma, rally last month that drew a much smaller-than-expected crowd.
UM supports Harvard lawsuit seeking to stop deportation of some global students
And Thursday, Purdue tweeted it would support the education needs of worldwide students in "every way possible". While Ecampus courses are fully taught by OSU faculty, they are designed for exclusive online instruction.
Republicans are struggling to recalibrate as restrictions on large, in-person events have mostly sidelined Trump's preferred campaign rallies. The adviser described the situation for Parscale as untenable. Dunn had joined Mr Biden at the outset of his campaign after having served President Barack Obama as a top communications adviser. That comes as Trump trails in the polls with less than four months to election day.
On Thursday, the Wall Street Journal and NBC News released a joint poll showing Biden ahead of Trump by a whopping 11 points among voters.
As the national director for John McCain's 2008 presidential campaign and New Hampshire political director on President George W. Bush's 2004 reelection effort, Stepien brought a heavy dose of campaign experience to Trump's operation.
Trump's campaign, like Trump himself, is unmanageable.
This could mean more aggressive attacks against Mr Biden or his running mate, and more co-ordination with the Republican National Committee.
The act seems to have worn thin.
Never has a US election come at such a moment of national mortification.
Despite that, the president struck an optimistic tone on Wednesday in announcing the news.
There's not a whole lot for Bill Stepien to work with here.