Speculation about his departure has been rife after reports suggested he was no longer on speaking terms with the president. The White House said another senior aide is in talks to take on the role.
US President Donald Trump on Saturday confirmed his chief of staff, John Kelly, is to leave his post at the end of the year.
"John Kelly will be leaving — I don't know if I can say 'retiring,'" he said, before adding: "I appreciate his service very much."
Nick Ayers, Vice President Mike Pence's chief of staff, is Trump's top choice to replace Kelly, and the two have held discussions for months about the job, a White House official said. An announcement is expected in the coming days.
Brought order to the Oval Office
Kelly, a retired Marine Corps general was headhunted in July 2017 to replace Reince Priebus, and to bring order to what many saw as a White House in disarray.
The former head of homeland security quickly fired White House communications director Anthony Scaramucci and Steve Bannon, the White House chief strategist who helped get Trump elected.
He then insisted that even Trump's daughter Ivanka and son-in-law Jared Kushner, both of whom have senior White House roles, go through him.
But although he is credited with bringing some discipline to Trump's administration, his tenure was hardly smooth, thanks to ongoing political intrigue and allegations of election collusion with Russia.
Kelly increasingly sidelined
His iron fist also alienated some longtime Trump allies, and over time, his role became increasingly diminished. US media reported last week that his relationship with the president had deteriorated to such an extent that the pair were no longer on speaking terms.
Kelly denied reportedly telling veteran Washington Post reporter Bob Woodward in September that the US president is "an idiot."
"It's pointless to try to convince him of anything. He's gone off the rails. We're in Crazytown. I don't even know why any of us are here. This is the worst job I've ever had," Kelly was quoted as saying in Woodward's book on the Trump White House.
His exit is the second top-level personnel change Trump has made since the mid-term elections on November 6, after Attorney General Jeff Sessions resigned last month at the president's request.
New Army chief of staff nominated
Trump on Saturday, meanwhile, announced he was nominating Army chief of staff General Mark Milley as his next top military advisor.
Milley, a four-star general who has served in Iraq and Afghanistan, will replace General Joseph Dunford as the US military's next chairman of the Joint Chiefs of Staff.
mm/aw (AFP, AP, DPA)