The Post Office chairman has been forced to quit by Kemi Badenoch as she called for "new leadership".
Henry Staunton was told by the Business Secretary on Saturday that he was to be replaced.
In a statement issued by the Department for Business and Trade, Staunton had "agreed to part ways with mutual consent".
Badenoch said: "The Post Office is rightfully under a heightened level of scrutiny at this time.
Kemi Badenoch told Henry Staunton to step down from his role as Post Office chairman
PA/GB News
"With that in mind, I felt there was a need for new leadership, and we have parted ways with mutual consent.”
An interim chair is expected to be appointed shortly.
Staunton had been in the role since December 2022, with a salary of up to £150,000.
Before that, he had worked on the board of a number of companies, including ITV and WHSmith.
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Henry Staunton had been in the role since December 2022
GB News
As part of his role, he had been tasked with leading the board of directors and righting the wrongs of the Horizon scandal.
A Post Office spokesperson said: "On Saturday afternoon, the Post Office was informed that the Business and Trade Secretary had asked Henry Staunton to stand down as chairman of the Post Office.
"We have been advised by the government that they will appoint an interim chairman shortly."
This departure is the latest rupture to come from the Horizon scandal, in which more than 900 Post Office workers were wrongly prosecuted after faulty software in the IT accounting system made it seem like money was missing from branches.
Sky News first reported the story and said that an insider claimed there had been several sources of tension between the Post Office chairman and the government in recent months.
This is reported to include a row over who should be appointed to a senior independent director role which is due to become vacant, as well as tensions over mistaken bonuses paid to chief executive Nick Read and linked to the Post Office’s co-operation with the Horizon inquiry.
Sources however claim that Staunton's exit was not directly related to the Post Office scandal.
His departure comes amid reports that Post Office staff are leaving their jobs due to backlash from the scandal that was brought to light by the ITV drama Mr Bates vs the Post Office.
Senior figures from the Post Office and Fujitsu, which developed the Horizon software, are currently facing a public inquiry over what happened.