Brian Cantor, who was appointed to the role at the University of Bradford in 2013, will leave at the end of the current academic year in 2019.
He will take up new a role as Emeritus Professor at the University of Oxford.
In a letter to staff in July, Prof Cantor warned that about 165 jobs could be lost amid a “tough” operating environment and a fall in applications.
Bradford Labour MPs Imran Hussain, Judith Cummins and Naz Shah called on the university to halt the job losses.
Public sector union Unison gave notice of a ballot for industrial action and an online petition was launched calling for a vote of no confidence against the Vice-Chancellor.
In a statement Prof Cantor said: “It has been a great privilege to be Vice-Chancellor at Bradford.
"When I moved to Bradford, we agreed a plan of renewing the University’s self-confidence as one of Britain’s first technology universities, enhancing the academic and managerial quality of the University, and then moving into investment-led growth.
“We have made great strides in the first two, but we have had to put growth on hold because of difficult external circumstances, leading to the management changes currently underway.
"I want to help see through these changes, which are essential for the future strength of the University.”
In 2013 Prof Cantor was awarded a CBE for services to higher education in the New Year’s Honours.
Baroness Ann Taylor, the university's Chair of Council, said: “It is an increasingly difficult time for everyone in this sector and we will miss Brian’s experience and wisdom. His leadership means he will be leaving us in a stronger position than when he came and for that we are extremely grateful.”