Nuno and Wolves have come to the agreement mutually and he departs after four seasons at the club.
The Portuguese boss has enjoyed a successful stint at Molineux, guiding the club out of the Championship and back to the Premier League in his first season.
Since then, Nuno has recorded back-to-back seventh placed finishes in the top-flight, while Wolves also reached the quarter-finals of the Europa League last season.
Wolves are 12th going into the final round of games this weekend, and Nuno and the club have now decided it is time to go their separate ways.
Nuno said: “Since the first day we arrived at Compton, 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.
“Firstly, I want to thank the supporters, who have all played such an important part in helping us reach new heights for Wolves, and the people of the city, who embraced us and made us feel at home.
“I, of course, 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.”