The club released a statement saying Warburton and a number of backroom staff would not continue after the end of the current campaign.
The statement said the club were keen for Warburton to work alongside a new sporting director with a new structure for player recruitment, a decision which appears to have brought about their split.
“We would have loved for Mark to stay, working within the new structure, but he feels that this is not right for him," chairman Cliff Crown said in the statement.
“We understand that completely and had to weigh up the benefits of the new structure against losing a fantastically successful manager before taking this decision."
The west London club have not played in the top flight for nearly 70 years and have spent most of the time since then bobbing about in England's bottom two divisions.
However, under the ownership of fan and multi-millionaire Matthew Benham, they won promotion to the second-tier Championship last season and are currently seventh, one point off the playoff places.
"While I am disappointed that we have been unable to reconcile some key philosophical differences, I’m relieved we now have clarity," Warburton said.
“In my remaining time at the club we shall move heaven and earth to get the promotion that the players, fans and Matthew deserve and going forward, I wish the club every success in its ongoing adventure."
Warburton took over from Uwe Roessler midway through last season and has developed an eye-catching attacking style that has gained widespread approval and given Brentford a real chance of reaching the top division they last graced in 1947.
(Reporting by Toby Davis; editing by Justin Palmer)
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