Edwards has been at the helm of the factory-backed Ford squad since 2005, overseeing two Bathurst 1000 wins (2013 and 2014) and one Supercars title (2015) during his tenure.
His exit comes amid a significant restructure for Tickford with the operation scaling back from four cars to two next season.
Two of the current Teams Racing Charters have been sold to Supercars with one having been on-sold to Blanchard Racing Team.
Some Tickford staff are known to be heading to an expanded BRT, while current Tickford driver James Courtney is also expected to drive for the team next year.
Cam Waters and Thomas Randle will continue in the two remaining Tickford entries.
Edwards, meanwhile, has already been linked to administrative roles at Supercars and Motorsport Australia, although says he has no firm plans beyond this year.
"It has been an incredible journey to lead this team and I am immensely proud of what we have accomplished together," said Edwards.
"I am grateful for the unwavering support of [owners] Rod [Nash] and Sven [Burchartz], our dedicated team, drivers, loyal sponsors and partners, and our passionate fans and members.
"The decision to step down was not made lightly, but I believe it's the right time for both my family and the team as we look toward the future.
“There has been speculation about where I will be heading next but my short-term plans are simple: I want to take some time out to explore this great country, enjoy some time with my friends and family, clear my head and focus on what is next.”
Nash thanked Edwards and wife Trudie, who runs the team catering and membership programmes, for their service to Tickford over nearly two decades.
“The Executive Team that Tim is part of has been working on strategic adjustments in the way the business continues to commercialise its opportunities over the past 12 months," he said.
"Part of that is welcoming a new era of leadership for the road ahead, all based on the strong foundation that Tickford is all about which is a direct result of Tim’s passion and the strong infrastructure he has put in place throughout his tenure.
"Tim has been one of the driving forces behind Tickford Racing for almost 20 years. His contribution to not only the team’s development but to the wider Supercars network cannot be understated. Tim has always played an active role in a number of boards and committees and is well respected in the paddock.
“Personally, I’ve enjoyed a great working relationship with Tim along with his wife Trudie who is also well known within the racing community.
"Trudie has always been a strong ambassador for the team with her roles in corporate hospitality and the team’s membership programme along with her catering skills that the whole team have appreciated immensely."
