The team announced Tuesday that Epstein is walking away from the organization, and general manager Jed Hoyer is being promoted to take his place as president of baseball ops.
"Theo and I have been communicating about this possible move for a couple of years, and we have been working together toward a transition that makes sense for the Cubs and for him," Cubs chairman Tom Ricketts said in a statement. "The timing is right for a number of reasons, and most importantly we are both thrilled that Jed is the person succeeding Theo.
"We have had our most successful period in over a century under Theo's leadership, and we are grateful for everything he has given to this organization and this city. Jed has been a big part of that success, too, and offers a combination of continuity and a fresh perspective that will serve us well as we look forward to another period of sustained success."
After this past season, Epstein said he expected to remain with the Cubs for at least one more year, with his contract set to expire in 2021. He has said repeatedly that he believes executives have about a 10-year shelf life in a job, and next season would have marked a decade since he left the Boston Red Sox to join the Cubs.
Epstein, however, told reporters Tuesday it became apparent this past summer that it was time to move on from the Cubs "for a number of reasons."
"It became really clear that we'd be facing some significant long-term decisions this winter, decisions with long-term impacts," Epstein said. "Those types of decisions are really best made by somebody who's going to be here for a long time, not just for one more year. ... Jed clearly is that person."
Ricketts called Epstein a "great partner and truly a great friend," saying it was a "sad day for me personally" because of Epstein's departure.
"Really, I think the legacy that Theo leaves behind is an organization that expects to win, not an organization that is surprised to win," Ricketts said Tuesday.
The 46-year-old Epstein led the Red Sox to World Series titles in 2004 and 2007 before arriving in Chicago following the 2011 season. He overhauled the Cubs' farm system as well as the scouting and analytics departments to produce the franchise's first World Series championship in 108 years during the 2016 campaign.