
Camacho, 52, resigned following Benfica's 2-2 draw with last-place Leiria in the Portuguese league on Sunday, saying his team lacked motivation.
The draw left Benfica 14 points behind leaders Porto with eight games remaining.
Camacho, who was Spain coach from 1998 to 2002 and has also been in charge of Real Madrid among others, had coached Benfica between 2002 and 2004.
"There is going to be a change in the sporting direction of the team. I think it is better for the team. The lack of motivation that I see in the players is not normal," Camacho told Lusa news agency.
Assistant coach Fernando Chalana will take temporary charge for Benfica's next match, a UEFA Cup encounter with Spain's Getafe on Wednesday. Benfica lost the first leg 2-1 at home last week.