AOL may have begun to lay off a significant portion of its workforce, according to story in tech gossip site Valleywag.

While Silicon Alley Insider reports that AOL will sack about a quarter of its workers by Oct. 16, Valleywag says some firings at the middle management level have already begun.

The rumors come in the wake of an announcement by AOL that it has moved its corporate offices from Dulles, Va. to New York as part of a larger reorganization effort to focus on the interactive advertising business.

AOL said it would not comment on the rumors.