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Kelly was long-rumored to be at-odds with the president, with some reports indicating the two were not even speaking.
Trump made the reveal while speaking with reporters on the White House lawn before heading to todays Army-Navy football game in Philadelphia.
“John Kelly will be leaving — I dont know if I can say retiring,” Trump said. “But hes a great guy. John Kelly will be leaving at the end of the year.”
No replacement has been named, but some reports suggest Mike Pences chief of staff, Nick Ayers, is a prime candidate for the job. Trump said he would announce a replacement – maybe on an interim basis – in the next day or two.
Trump previously denied a rift with Kelly, saying in October he was “doing a very good job.”
“We have a very good relationship. The White House is running very, very smoothly,” he told New York magazine.
Kelly reportedly planned to stay until 2020 at Trumps request. He replaced Reince Priebus in the position. The retired four-star Marine general served as secretary of homeland security during the first months of 2017, moving to chief of staff in July 2017.