Chicago announced the move Sunday, before taking on the St. Louis Cardinals in the final game of the season. The Cubs (84-77) won at least 92 games in each of Maddon's first four seasons with the team. Maddon, 65, led the Cubs to a World Series title in 2016.
"We both agreed that it's time," Cubs president Theo Epstein told reporters. "This type of change is a win-win. It's going to be great for Joe. He's at a wonderful point in his life. There is going to be a bidding war for his services and their should be.
"He's in a great position. I look forward to his next chapter in baseball and in life. It's going to be good for the Cubs too. I think we are at a point where we just need a little bit of change and something new."
Maddon began his managerial career in 1996 with the California Angels. He spent nine seasons as the manager of the Tampa Bay Rays before joining the Cubs in 2015.
"In a way, bad news, but also good news at the same time," Maddon said. "We are both going to move on. The Cubs are going to flourish. Hopefully I get a chance to do this somewhere else. There are no tears shed. It's a good moment for everybody."