The talk show co-hosts confirmed their departure in separate statements Thursday.
Shepherd, 47, has been with the series for seven seasons. She started as a guest co-host in 2006, and was made a permanent co-host in 2007. In 2009, she won her first Daytime Emmy Award for Outstanding Talk Show Host.
"It's been seven wonderful years on The View and after careful consideration it is time for me to move on," she said in a statement to The Wrap. "I am extremely grateful to Barbara Walters and [executive producer] Bill Geddie for giving me the opportunity. I look forward to the business opportunities that lay ahead for me and I am incredibly grateful to my View family and my fans for supporting me on this journey."
When McCarthy, 41, caught wind of Shepherd's announcement, she took to Twitter to declare, "If Sherri goes... I go too. #sisters." The former Playboy model is the newest addition to The View, having replaced Elisabeth Hasselbeck in September 2013.
"My View will be changing too," she tweeted later in the evening. "As will with many hard working folks. Thanks to everyone at the show for your dedication and an amazing year."
ABC reportedly wanted to keep Shepherd on the show, but the two sides were unable to agree on a new contract. A network representative tells the New York Post, "The View will be moving in an exciting new direction next season and ABC has made decisions to evolve the show creatively." Creator and co-host Barbara Walters retired and left the program less than two months ago.