Dunga's tenure as Brazil manager is over following the team's elimination from the World Cup.
The former midfielder was appointed as national team manager after the last tournament in 2006, signing a four-year deal to replace Carlos Alberto Parreira at the helm.
He had success initially, helping the Selecao win the Copa America in 2007 and emerge triumphant at the Confederations Cup two years later.
Brazil also enjoyed an impressive World Cup qualifying campaign, finishing top of the South American section.
Dunga was credited with improving the team's defence and giving them more steel, and Brazil travelled to South Africa among the favourites to lift the trophy.
But the biggest prize eluded Brazil as they bowed out of the World Cup at the quarter-final stage following a 2-1 defeat to Holland.
Dunga stated after the match that he had been surprised by the outcome, with Brazil having looked strong earlier in the competition.
He indicated that he would not stay in the job and has quickly confirmed that there is not now any prospect of his contract being extended.
"We are all responsible for this situation but I have the greatest responsibility," said the 46-year-old.
"I was contracted for four years and we knew that from the start."
Two bloggers out in South Africa, another 32 following a nation each... welcome to World Cup FanZone.