Benítez joined Real Madrid's coaching staff at the age of 26, going on to work as the under-19 and reserve team coach, and assistant manager for the senior team. Benítez moved away from Real Madrid, to start his career as head coach around Europe.
After plenty of successful years in Spain, England and Italy, Benítez returned to Spain and became coach of Real Madrid in June 2015 on an initial three-year contract. On 4 January 2016, however, he was dismissed following a 2–2 draw against Valencia, with Real Madrid third in La Liga behind Barcelona and Atlético Madrid.
On 11 March 2016, Benítez was announced as the manager of Newcastle United.