Newscastle tried to tie Benitez down to a new contract at St James’ Park for the past 18 months.
The Spaniard, however, opted against penning a new contract with the north-east club having grown frustrated over transfers and budgets.
Benitez was hoping to come to terms with his employers, who have decided not to meet the former Valencia and Liverpool boss’ demands.
“It is with disappointment that we announce manager Rafael Benitez will leave Newcastle United upon the expiry of his contract on June 30, 2019,” a club statement read.
”We have worked hard to extend Rafa’s contract over a significant period of time, however it has not been – and will not be – possible to reach an agreement with Rafa and his representatives.
“Rafa’s coaching staff, Paco de Miguel Moreno, Antonio Gomez Perez and Mikel Antia, will also leave the club on June 30.
“We would like to thank Rafa and his coaching team for their efforts over the last three years and their significant contribution to what has been collectively achieved.
“We would also like to thank our supporters, players and staff for their patience during a period of uncertainty.”
Benitez took charge of Newcastle in March 2016 when the club were on the brink of relegation, penning a three year deal with the Toon.
Mike Ashley’s side didn’t end up beating the drop but Benitez decided to stay at the club and guide them back to the Premier League.
The Magpies made an immediate return to the top-flight by winning the 2016-17 Championship season, ending the campaign with 94 points.
He then helped them re-establish as a mid-table side in the Premier League.
Benitez’s departure, however, has cast serious doubt over the proposed takeover at St James’ Park.
Source: Daily Mail