Former Socceroos defender Popovic spent three seasons at the Victory, leading the club to an Australia Cup title as well as an ALM semi-final and grand final.
The 50-year-old's final act in charge was last month's championship decider, which ended in an agonising 3-1 defeat to Central Coast in extra time.
"Tony enlisted a winning culture which leaves the club in a better place than when he arrived, challenging for titles and using hard work, discipline and respect to drive outcomes," Victory chairman John Dovaston said in a club statement.
"The next step for us is to find someone who will be a natural progression from Tony.
"He has set the foundations for us and we look forward to appointing a head coach who will be able to use those foundations and go one step further next season."
Thank you, Boss!— Melbourne Victory (@gomvfc) Tony Popovic will depart the Club after three seasons at Melbourne Victory.Thank you and all the best, Tony 💙June 12, 2024
Former Victory and Socceroos captain Mark Milligan, currently an assistant at Adelaide United, has been linked to the role.
Other coaches currently on the market include former Mariners boss Nick Montgomery and ex-Melbourne City mentor Patrick Kisnorbo.
There is plenty of talent for the next coach to work with.
Socceroos winger Daniel Arzani, goalkeeper Paul Izzo, captain Roderick Miranda, midfielder Ryan Teague and playmaker Zinedine Machach are among those contracted for next season or beyond.
But defenders Jason Geria, Damien Da Silva and Adama Traore are all off contract while several players, including Jake Brimmer and Chris Ikonomidis, have already departed.
Popovic's next move is yet to be confirmed, though he has been linked to Croatian club Hajduk Split, after previously trying his luck in Europe at Greek club Xanthi and Turkish outfit Karabukspor.
He joined the Victory on a bumper three-year deal when the club had just claimed their first wooden spoon, charged with turning the club around.
Popovic proved a stabilising force, including guiding the Victory through the pitch invasion saga of late 2022 that derailed that season.
While the Victory again returned to the league's upper echelon this campaign, Popovic received some criticism for his pragmatic playing style en route to the grand final appearance.
One of Australia's top-rated coaches, Popovic has had the misfortune of reaching five ALM grand finals as a coach and losing all five across his time with Western Sydney, Perth Glory and the Victory.
He led the Wanderers to the AFC Champions League title in 2014.
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