Herald Sun editor-in-chief Phil Gardner has taken a redundancy package and is to leave News Corporation at the end of this week.
His departure follows the media group's decision last week to cut the board of the Herald Sun's publisher, Herald & Weekly Times (HWT), from six directors to four.
Earlier this year Mr Gardner had been linked with a job within News integrating its newspaper sports desk with Fox Sports.
However, although staff held a going-away tea for him, complete with cake, he never began in the role.
News of Mr Gardner's imminent departure was broken to staff by News' Australian head, Kim Williams, in an email on Thursday.
The HWT board shrank last week with the resignation of Rupert Murdoch's sister, Janet Calvert-Jones, Reg Cordina and chairman Julian Clarke.
Ms Calvert-Jones' daughter, Penny Fowler, was appointed to the board. It now consists of Ms Fowler, Mr Williams, Jeremy Harris and newspaper veteran Peter Blunden.