Heading into the tournament, Portugal were one of the favourites to win it but were ultimately knocked out in the round of 16 by Spain.
Mikel Merino’s 91st minute strike sealed their fate in what was a drab game between the two European giants.
Now, per Fabrizio Romano, Martinez, 52, has decided to step down from his position of Portugal manager.
“It’s the end of the cycle. It’s important to have a new voice, a new leader,” Martinez said after the game.
“It had not been decided previously (that I would leave after the tournament). I came with the goal to win the World Cup, and because I did not win, it does not make sense to continue.
“I take with myself the memories, and hope that Portugal has good memories in the three and a half years I was head coach of the team. It was the experience of my life.”