The 48-year-old ended the Magpies' 70-year wait for domestic silverware with Carabao Cup glory in 2025, as well as overseeing qualification for the Champions League twice.
However, a disappointing campaign saw Newcastle finish 12th in the EPL last season and the club have endured a difficult transfer window this summer.
Howe was in charge of Wednesday's 4-1 pre-season friendly defeat at Bristol City on Wednesday night and it emerged the following morning that he was set to leave after nearly five years in charge.
The EPL club confirmed his exit on Friday afternoon, saying they had accepted his decision to step down and thanked him for his "extraordinary contribution".
Departing Howe said in a lengthy statement: "After a period of personal reflection, I have decided that now is the right time for me to step away from my role as head coach of Newcastle United.
"After nearly five years of giving my life, heart and soul into the club with unrelenting energy, I feel that it is in the best interests of both myself and the club to step away, recharge and take a break.
"Although it's been incredibly difficult to make this decision, I know in my heart that it's the right one. I have always put the best interests of Newcastle before my own in every single decision I have made whilst I've been here and this one is no different.
"It has been the privilege of my lifetime to have been the manager of Newcastle United."
Newcastle say the process to recruit a new head coach is at an advanced stage. German coach Matthias Jaissie, currently in charge of Saudi Pro League club Al-Ahli, is widely reported to be favourite to be handed the position.
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