The former Real Madrid player arrived in Sevilla in August and has made 19 appearances for the club, scoring one goal.
Isco had left Real Madrid in May after nine years, winning 19 trophies including three league titles, five Champions League trophies and four Club World Cups.
The club, although current manager Jorge Sampaoli (62) had always had confidence in him, did not want him after what happened with sporting director Monchi (54) and reports that he was not involved enough.
The player also did not want to prolong his stay in a team that was not meeting his expectations - they are in a relegation fight.
"Sevilla and Isco Alarcon have agreed to terminate the contract that has been in place since the Malaga-born player joined the club last summer after finishing his time at Real Madrid," said Sevilla, who added that "Isco has played a total of 19 official matches as a 'blanquirrojo', divided into 12 LaLiga games, six Champions League matches and one in the Copa del Rey.
"He scored one goal, against FC Copenhagen in European competition, and provided three assists. The club would like to wish Isco all the luck in the world in his new professional challenges."
Off to the Premier League?
Isco's former manager Julen Lopetegui (56) would be delighted to be able to count on the magic of the Arroyo de la Miel player once again. It has been the Basque coach who has been able to get the best out of Isco.
He did so both with the Spanish national team and in the short time he spent at Real Madrid.
Now, having started his Premier League adventure less than a month ago, he continues to shape his new Wolves' side and Isco, who would need no transfer payment, would fit him like a glove.
Newcastle United, who have been linked with all the big stars who have fallen out of favour, have also been mentioned as a possible destination.
Isco has always been reluctant to start an adventure away from Spanish football, even when Manchester City and Pep Guardiola (51) kept knocking on his door during his best days at Madrid.
But at 30 years of age and after the last few years in white and the last few months at the Pizjuán, has dropped a lot. That is why in LaLiga he has no credibility among the big clubs and the door is open to England or some other market where money can be made.
