Schalke have confirmed on their official website that veteran forward Raul will leave the club at the end of the season.
The 34-year-old has an expiring contract at the Gelsenkirichen side, and has made the decision not to renew his existing deal.
Raul joined Schalke from Real Madrid in the summer of 2010 and immediately became an important first-team player at the German outfit, guiding the Konigsblauen to DFB Pokal glory and the semi-finals of the Champions League.
Schalke had offered the Spaniard a one-year extension, with his wages reduced from €7 million to €4m, but it is believed that the player was holding out for a two-year deal.
Raul has made 63 Bundesliga appearances for Schalke so far, scoring 27 goals in the process. He has been linked with moves to the United States and Asia, but his agent Gines Carvajal recently dismissed reports that he was bound for Qatar.
A press conference is scheduled to take place at 13.00CET, where more information about Raul's future will be disclosed.