A Barca great, Xavi has long been tipped to return to Camp Nou as head coach – firstly before Ronald Koeman's appointment at the start of 2020-21 and after Joan Laporta's presidential election victory.
But Spaniard Xavi will remain in charge of Qatari side Al-Sadd until 2023, it was announced on Wednesday.
The 41-year-old has guided Al-Sadd to Qatar Stars League (2020-21), Qatar Cup (2020 and 2021), Qatari super Cup (2019), Emir of Qatar Cup (2020) and Qatari Stars Cup (2019) success since becoming coach in 2019.
"We achieved a lot together, scored goals, won matches and titles, and we are all very proud of this success. Getting this kind of support is the best thing any coach can get," said Xavi, who spent 17 years with Barca, where he won eight LaLiga trophies and four Champions League titles among other honours.
"I have everything I could want to do well, and I feel proud to continue with Al-Sadd for an additional two seasons."
Xavi – who held the record for most Barca appearances before it was broken by Lionel Messi this season – also denied he has a clause in his contract that allows him to leave Al-Sadd amid Barca links.
"This is incorrect," the former Spain international added. "I have a two-season contract with Al-Sadd, and I respect this contract - and I also respect the official negotiation methods between all parties."