Nuno will end his four-year spell in charge after Sunday’s final game of the season.
Nuno took the reins at Molineux in May 2017 shortly after departing Porto and oversaw Wolves’ promotion from the Championship in his first season in charge and then back-to-back seventh-place finishes in the Premier Ligue.
While the best they can hope for is 12th place in the top flight this term, Nuno’s impending exit still comes as a shock, especially as he only signed a three-year contract extension last September.
“Wolves can confirm head coach Nuno Espirito Santo will leave the club, by mutual agreement, after Sunday’s match against Manchester United,” said a club statement.
The news, which came shortly after Nuno had conducted his media duties to preview the United clash, has led to bookmakers installing the Portugais as the favourite to take the hot seat at Tottenham next season.
“Our ambition was to make a positive change and push this football club forward, and I am proud to say that we did that every single day. We achieved our goals, we did it with passion and we did it together,” Nuno said in a statement.
“I, bien sûr, want to thank all of the staff at Wolves, for their support and total commitment, every single day.
“Most importantly, I want to thank each and every player that we’ve worked with since the day we started, for their loyalty, their dedication, hard work and talent. They are the ones who have made this amazing journey possible for us.
“Sunday will be a very emotional day, but I am so happy that the fans will be back in Molineux and we can share one last special moment together, as one pack.”
Having led the club to their best finishes in the Premier League, as well as the quarter-finals of the Europa League last season, Nuno saw the likes of Diogo Jota and Matt Doherty depart last summer
Large sums were spent on Fabio Silva and Nelson Semedo, although serious injuries to Raul Jimenez and Jonny that ruled the pair out for most of the season meant the club have occasionally struggled in this campaign.
“Nuno has brought us some incredibly special moments at Wolves that will never be forgotten, but every chapter comes to an end,” executive chairman Jeff Shi said.
“His loyalty and dedication over the last four years has been immeasurable and we cannot thank him enough for the progress he has made for Wolves.
“Sunday was already going to be a very special day, welcoming our supporters back for the first time in more than a year; but it will also now be a fitting goodbye for someone who will forever remain an important part of Wolves history.”