"I am ruling myself out of continuing," Pizzi said in comments reported by Chilean media and confirmed by veteran midfielder Gary Medel.
Pizzi, 49, led Chile to victory at the 2016 Centenary Copa America but his ageing team have struggled in the closing stages of the qualifiers, winning just two of their last six games.
Several of the team's biggest names -- including Claudio Bravo, Arturo Vidal and Medel -- are already in their 30s and Tuesday's defeat in Sao Paulo appears to have signalled the end of the most successful team in the country's history.
(Reporting by Andrew Downie; Editing by John O'Brien)
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