Nathan Brown will exit the Newcastle Knights at the end of 2019.
Brown and Knights officials met on Monday night and came to a mutual agreement to part ways at season's end with Newcastle's finals hopes still up in the air.
In comments posted on the Knights website, Brown said his time at the club had run its course.
"My main job was to come here and put the club back together," Brown said.
"It's been a tough but enjoyable job. I've met lots of great people and I feel the club is far better off for me coming here.
"The roster and salary cap issues have been resolved and there's the potential of a team to have sustained success.
"A lot of the heavy lifting has been done and now I'm leaving it to the next group of club leaders to continue the job.
"But it’s important to remember the year is not over and I look forward to finishing the season off strongly and push for a final birth."
Brown signed a performance-based contract with the club last year, an NRL-first, with no set term on his tenure.
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The arrangement means the club will not face a costly payout.
The Knights face Wests Tigers on Saturday night sitting in 10th place on the ladder, two points outside the top eight with three weeks of the regular season remaining.
NRL.com has been told that even if Newcastle were to go on an unlikely run to the semi-finals and further, there will be no reconsideration of Brown's exit.
Brown has coached the Knights since 2016, leading a rebuilding of the club's roster in that time. Newcastle finished with the wooden spoon in the first two years of Brown's tenure – as they had in 2015 – before finishing 11th last season.
An extensive recruitment drive that added David Klemmer to last year's big-name arrivals Mitchell Pearce and Kalyn Ponga had heightened expectations around the Hunter club.
A return to finals football looked likely when a six-match winning streak lifted them into the top four around the Origin period, only for their recent six-game losing run to drop them back down the ladder.
Star recruit Jesse Ramien was also told he was free to leave the club in that period after failing to find his feet in his first season in Newcastle.
Brown is yet to consider his future options and whether he would pursue another head coaching job in the NRL or overseas, but his exit has been sorted now to ensure he has time to do so before next season.
Knights chief executive Phillip Gardner on Tuesday paid tribute to Brown's work at the club.
"Nathan will go down as one of the most important coaches in Knights history," Gardner said.
"When he joined our club ahead of the 2016 season, it was at its lowest ebb. The sheer size and scale of the task he was faced with was monumental. It would have broken a lesser man.
"Put simply, it would be wrong to measure his contribution to the Knights in wins and losses alone.
"Nathan shaped our roster as he did our club. He once again made Newcastle a place that players wanted to not just play in, but play for."