Ancelotti retreats after an 18-month stay at Goodison Park during which he led the Blues to respective 12th and 10th-placed finishes.
The 61-year-old Italian achieved the highest points-per-match ratio, 1.53, of any Everton manager in the Premier League era.
He proved a popular figure at the Merseyside club, endearing himself to the fans with his human touch and willingness to reach out to the local community during the suspension of the 2019/20 Premier League season.
Ancelotti said in a statement on the club’s official website “I would like to thank the Board of Directors, the players, and the Evertonians for the tremendous support they have all given me during my time at the Club,”.
“I have complete respect for everyone associated with Everton and hope they can achieve the exciting opportunities they have in front of them.
“While I have enjoyed being at Everton I have been presented with an unexpected opportunity which I believe is the right move for me and my family at this time.”
Presently, Everton has begin the process of appointing a new manager.