The news comes a day after the 40-year-old Portuguese coach was confirmed as a participant in January's Dakar Rally alongside compatriot Ruben Faria.
"We hereby announce that the club and Mr. Villas-Boas are heading in different directions and have their own respective targets," the club statement said.
"We appreciate the effort and the contribution Mr. Villas-Boas and his technical team have given and we hope they will enjoy great success in the future."
Villas-Boas' resignation comes after just one year at the club, during which time he led SIPG to the runners-up position in the Chinese Super League and the Chinese FA Cup, as well as to the semi-finals of the Asian Champions League.
But he fell short of delivering SIPG their first trophy during a season in which the club spent heavily on foreign talent. Villas-Boas, who previously coached Chelsea and Tottenham in the Premier League, also earned two separate bans from the Chinese Football Association for his behaviour.
In June he was handed a two-match ban for publicly supporting high-profile signing Oscar, when the Brazilian was given an eight-match suspension for instigating an on-pitch brawl during the club's draw with Guangzhou R&F.
In October he was given up an eight-match sanction of his own after being sent to the stands for gesturing towards the referee during his side's 1-0 win over Beijing Guoan.
Villas-Boas was appointed SIPG coach last November as replacement for former England manager Sven-Goran Eriksson. Media reports at the time suggested he was earning an annual salary of around $13.7 million (£10.17 million).
(Reporting by Michael Church in Hong Kong, Editing by Christian Radnedge)
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