The 51-year-old came to a mutual agreement to exit the club following just one season in charge.
Martino replaced the late Tito Villanova at the Nou Camp last summer, but the Spanish Super Cup was the only silverware he managed to claim as Barca endured a largely inconsistent campaign.
"In agreement with the club I am no longer the coach," Martino said.
"I deeply regret not having achieved the goals that this club has always been set and achieved.
"These are great players. My greatest gratitude goes to the players. They have made me proud."
Barca's sporting director Andoni Zubizarreta said: "We are grateful to 'Tata'. This has been a tough season."
Martino's side were one game away from retaining the Liga trophy as they hosted Atletico on the final day of the season, but despite Alexis Sanchez's opener, a second-half header from Diego Godin was enough for Diego Simeone's men to end their 18-year title drought.
Martino's future had been the subject of much speculation for some time and reports have suggested that former Nou Camp hero Luis Enrique could be set to replace him.
On Friday, Enrique announced he was stepping down as Celta Vigo coach, having been heavily linked with a return to the club where he finished his playing days and began his coaching career with Barcelona B.