The club revealed on Thursday that Zidane was to appear in a hastily arranged news conference that caught many by surprise, fuelling speculation that his tenure at the Santiago Bernabeu could be coming to an end.
Zidane confirmed his departure at the start of the news briefing, just five days after he presided over the 3-1 Champions League final win over Liverpool.
"It's time to go. These players need a different discourse, a different methodology," the Frenchman said.
Such success, which he also managed in each of his first two seasons in charge of the team, has not been enough to persuade him to prolong his spell.
Madrid's third-place LaLiga finish is likely the major factor in Zidane's departure, as Los Blancos ended the season 17 points adrift of bitter rivals and champions Barcelona.
He did, however, confirm that he was not pushed out of the door.
"It's my decision," he said. "For many people, this will not make sense, but it does for me. It's time for a change," he confirmed.
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