"Real Betis and Quique Setien have decided that the coach will not be in charge of the club next season," said a statement from the club, who finished 10th in La Liga after coming sixth last season.
Sunday's win at the Bernabeu was Betis' second successive victory away to Real Madrid, while earlier this season Setien's side beat champions Barcelona 4-3, becoming the first team in over two years to win at the Nou Camp. Yet his side struggled for consistency and suffered embarrassing defeats to some of the lowest-ranked teams in La Liga, including a 3-0 loss at Leganes and a 4-0 thrashing away to Levante.
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