In a statement, the Oakwell outfit have expressed disappointment at the departure of the 45-year-old Frenchman, who performed an outstanding job in taking the Reds to the play-offs in a memorable 2020-21.
But the former LASK Linz head coach, who had a release clause in his deal allowing him to speak to other clubs if they activated the agreement, has now finally moved to the Midlands following talks which began late last week and leaves after just eight months in charge.
Barnsley have pledged that all proceeds of the buyout - reportedly a £2m fee - will be used to strengthen the squad with a further update following in due course on the replacement for Ismael.
The departure of the former Bayern Munich defender means that Barnsley are looking for their sixth head coach in the space of under three-and-a-half years.
The club have gone continental to bring in their last four appointments in Ismael, Gerhard Struber, Daniel Stendel and Jose Morais, with their last three appointments having all been successful.
Work permit rules are likely to mean that appointing another head coach from Europe may not been straightforward and it remains to be seen what route Barnsley - who have cultivated links in the US during the stewardship of Dane Murray - follow.
Former caretaker boss Adam Murray who was interviewed for the position last autumn and has taken charge on an interim basis on two occasions is likely to be a contender once again - if he remains at Oakwell and does not head to the Midlands with Ismael.
The position is also likely to be an attractive one for many domestic managers and head coaches, given the Reds' achievements last term.
A Reds' statement read: "The 20/21 season will live long in the memory of all those with an affinity to the Reds.
"The Club would like to thank Valérien for his efforts over the last nine months. He and his family will always be welcome at Oakwell.
"The Club would also like to thank supporters, players and staff for their patience during this period. Now, continued progression must be ensured, with the recruitment
process for a new head coach already underway.
"All proceeds from the buyout of the contract will be utilised to strengthen the squad ahead of the forthcoming season. A further update will follow in due course."
In an uncertain time for the club, the future of chief executive officer Dane Murphy remains up in the air with his contract running out at the end of June and the American having been headhunted by Nottingham Forest.
Captain Alex Mowatt is also out of contract shortly and is attracting interest from several clubs.
Ismael is set to return to the United Kingdom later this week and will follow Government COVID-19 quarantine rules prior to joining the West Brom first-team squad for pre-season training.
Albion Chief Executive Officer, Xu Ke, said: “I am delighted to welcome Valérien to The Hawthorns.
"Valérien has established a reputation as an excellent coach and I have been impressed by his professionalism, enthusiasm and hunger to succeed.
"His performance last season with Barnsley, and his coaching career to date, all point to a man who has a long, successful career in front of him. It is my hope that he is with us for at least the next four years."