He was unable to find his form in FC Barcelona, losing his place in the first team and was loaned to Villarreal a year later, where he currently plays alongside fellow Argentine international Juan Pablo Sorín.

Despite his lack of pace Riquelme is often regarded as an extremely talented playmaker with excellent creative vision and close ball control, and with 15 goals and 11 assists, is often cited as the main factor in Villarreal's explosive 2004-05 campaign. Riquelme is arguably among the five most gifted players in the world, his astute and simultaneously imaginative sense of play setting him apart from his footballing colleagues. At the end of that season, Spanish sports newspaper Marcaawarded him the title of Most Artistic Player. As a result of his influential play, he earned a nomination for the 2005 FIFA World Player of the Year award. In an effort to keep hold of him, Villarreal bought up 75% of Riquelme's rights from Barcelona for 5 million euros, and gave the player a 4-year contract.

A peculiar contract situation arose when, on December 7, 2005, Villarreal beat French club Lille OSC 1-0 to win its UEFA Champions League group, knocking out English giants Manchester United F.C., and Lille and advancing to the lucrative knockout stages in the club's debut season in the Champions League. Because of a clause in the transfer contract with Barcelona, Villarreal had to pay one million euros to the Catalan club. The contract includes another two one-million Euro clauses; one if Villarreal finishes in one of the top 4 positions of the Spanish Primera Liga in the 2005/2006 season, and an identical clause for the 2006/2007 season.

On April 2006 the English newspaper The Daily Mirror published a rumor about a possible interest of Manchester United's boss Sir Alex Ferguson in signing the Argentine international in the summer transfer window, whose club would have made an offer of £10 million, which was declined by the Villarreal.

Jens Lehmann fantastically saved his 88th-minute penalty in the second leg of the Champions League semi-final versus Arsenal on April 25, 2006, which almost certainly would have taken the match at El Madrigal stadium into extra time.