The director of the Irish Museum of Modern Art, Mr Declan McGonagle, has decided to step down despite being offered a new contract.
This follows a five-month dispute with the board of the museum over the advertising of his post.
He is negotiating a severance package with Mr Paddy Teehan, appointed by the Government to mediate between him and the chairwoman of the board, Ms Marie Donnelly. The board was informed of his decision yesterday.
Mr McGonagle sought a High Court injunction last December preventing the board of the IMMA from advertising his post, which he had held since the museum opened in 1991. Ms Donnelly had informed him a week earlier that the post was being redefined and would be publicly advertised.
The board undertook to the court not to advertise the post, and engaged in discussions with Mr McGonagle, through Mr Teehan.
Discussions also took place within the board, which was divided on Mr McGonagle's future with the museum.
However, amid numerous public statements of support for the embattled director from prominent figures in the arts and among IMMA sponsors, these ended with a unanimous decision to offer him a new five-year contract.
Despite this, the mediator made a report to a meeting of the board yesterday saying Mr McGonagle had decided not to stay on.
It is understood that no details of the negotiations on the severance package were discussed at the meeting.
In a brief statement yesterday Mr McGonagle said: "Now that the board of the museum has agreed to offer me a new contract, to which, as I have been arguing, I am entitled, I have considered my position in these circumstances.
"I have decided that my future lies elsewhere and I will therefore leave the Irish Museum of Modern Art. I am now discussing a severance package with the mediator.
"I wish the museum every success and look forward to it achieving its full potential as an artistically excellent and inclusive public institution."
The board issued a statement, saying: "The board of IMMA wish to record their sincere appreciation to Declan McGonagle for all his work at IMMA in the years since its foundation. The board know that in doing this they also speak for all previous boards of the museum. The board wish Declan every success in the future he undertakes."
The board must now face the prospect of seeking a new director in a situation where the outgoing one had found himself unable to continue.
In doing so the divisions within the board on the museum's basic philosophy and future direction are likely to resurface.