Luis Aragones will stand down as Spain coach when his contract expires after Euro 2008.
“I’ve told the Federation that they should be looking for a replacement for after the European championship,” the 68-year-old said.
“It’s normal that they should look for a new direction after Euro 2008.”
Aragones took over as Spain coach from Inaki Saez in July 2004, but he has enjoyed little success in charge of the national side.
Controversial remarks about French striker Thierry Henry caused a furore that overshadowed his first season in charge and results on the pitch have been disappointing.
Aragones said he would step down if Spain did not reach the World Cup quarter-finals, but he reversed his decision after seeing his side make a second round exit at the hands of France.
His position came under further scrutiny following back-to-back defeats against Northern Ireland and Sweden in qualification for Euro 2008, but the Spanish Football Federation (RFEF) responded to these setbacks by offering him a new two-year deal.
Subsequent victories against Denmark, Iceland and Latvia have put Spain back in the running for qualification. They meet Liechtenstein on Wednesday.