The departure comes just three months after Labour's election victory in July, but is not unexpected. Gray has been in unwanted media spotlight after receiving a salary increase that made her earn more than the prime minister, and also being blamed for the party's lack of preparations for taking power.
In a written statement, she says that "over the past few weeks, it has become increasingly clear that my position risks diverting focus from the government's important work", writes The Times.
Gray is also reported to have fought internally for her cause, particularly against party strategist Morgan McSweeney – who will replace Gray as chief of staff.
Sue Gray is now moving to a role as Starmer's envoy within the UK and will help to convey the government's policy to the regions.
Gray became a well-known name in the UK when she led the investigation into former Prime Minister Boris Johnson's parties during the pandemic, which became known as "partygate".