Claudio Ranieri steps down as Cagliari manager amid retirement reports
The announcement came after Cagliari guaranteed themselves another season in the Italian top flight following their away win at Sassuolo on Sunday.
Sky Sports Italia reported that Cagliari will be Ranieri's final team, as he has decided to retire from football.
The Italian coach, who had previously managed Cagliari in 1988, had one year remaining on his contract after joining the club last season and leading them to promotion from Serie B.
"Mister Ranieri bids farewell to Cagliari. In his two spells with the club, he always managed to lead the team to achieve their original objective," Cagliari said in a statement.
"These are tears of joy and gratitude for the man who was able to write some of the most beautiful scripts in Cagliari's history. What he did will remain indelible in the hearts of every supporter."
Ranieri will coach Cagliari for the last time on Thursday when they host Fiorentina in their final game of the season.
The Italian coach, who has managed Juventus, AS Roma and Inter Milan among others in Serie A, is best known for guiding Leicester City to a fairytale Premier League title in 2016.
He also managed teams such as Chelsea, Fulham and Watford as well as Valencia and Atletico Madrid in Spain's LaLiga.
"I have decided to leave now and it is the right thing to do," Ranieri said in a video on Cagliari's social media.
"I do it reluctantly because it was a hard and painful decision, but I think it is right."
