"Olympique Marseille and Didier Deschamps have agreed not to continue their collaboration for the 2012/13 season," Deschamps and Marseille said in a joint statement on the club's website.
Marseille said they would name a replacement for Deschamps "in the coming days".
Deschamps joined Marseille in 2009 and led them to the French title in 2010 in his first season.
Blanc said on Saturday he would not renew his contract as France coach after Les Bleus were knocked out of the Euro 2012 quarter-finals.
The French federation's executive committee is due to meet on Tuesday at the FFF headquarters in Paris.
Deschamps, who skipped France to their 1998 World Cup and Euro 2000 titles, began his coaching career at Monaco in 2001, leading them to the Champions League final in 2004 before helping Juventus win back promotion to Serie A in 2007.
After a one-year sabbatical, Deschamps looked poised to take over from Raymond Domenech after France were eliminated in the first round of Euro 2008 but the former coach eventually kept his job.
Deschamps, 43, replaced Belgian Eric Gerets as Marseille coach in 2009 and gave the Provence side their first French title in 18 years in his maiden season.
He also won three French League Cup titles in a row with Marseille, who, however, had a mediocre 2011/12 season, finishing 10th.