The former Australia fast bowler is to leave the club at the end of the season.
The news is a body blow to the county champions, whom Gillespie has led to back-to-back Championships.
However, it is not entirely unexpected, with Gillespie’s wife and four children having recently returned to Australia, and with his future having been a regular source of speculation.
Gillespie has been linked with a number of international coaching jobs during his five seasons in charge, and he already doubles up as coach of the Big Bash franchise Adelaide Strikers.
Yorkshire had hoped that he would stay for at least another year, but after the club lost to Surrey in the Royal London Cup semi-final yesterday, Gillespie communicated his decision to the Yorkshire board.
Yorkshire say they will start the search for a new head coach at the end of the season, who will work under director of cricket Martyn Moxon.
In a statement issued today, the club said: “Yorkshire County Cricket Club can confirm that Jason Gillespie will leave his position as head coach at the end of the 2016 season.
“The club would like to place on record its thanks to Jason, who led Yorkshire from the Second Division to consecutive Championship titles, along the way suffering just five defeats in 76 Championship fixtures since his appointment in November 2011.
“His wife Anna and their four children have recently returned to Australia and, with the 41-year-old’s existing commitments to coaching the Adelaide Strikers in Australia’s Big Bash, Jason feels the close season is an appropriate time to part company.
“Martyn Moxon will not begin the search for a new head coach until the end of the current season, and the club will provide further updates when the time is appropriate.”
Gillespie has the chance to go out on a high, with the club well-placed to secure a hat-trick of Championships.
Yorkshire go into Wednesday’s match against Hampshire at the Ageas Bowl in second place in Division One, five points behind leaders Middlesex with four games to play.