Comolli joined the Merseyside club as director of football strategy in late 2010, before being promoted to the more senior post of director of football in March of 2011. However, he will now return to France for 'family reasons'.
"I am grateful to have been given the opportunity to work at Liverpool and am happy to move on from the club and back to France for family reasons," Comolli said. "I wish the club all the best for the future."
A key figure in the January 2011 transfers of both Luis Suarez (pic) and Andy Carroll, after being promoted by new club owners Fenway Sports Group the Frenchman was also instrumental in the widely questioned summer signings of the likes of Stewart Downing, Charlie Adam, Jordan Henderson and Sebastian Coates - expensive additions that have failed to prosper in a Reds side that has struggled in the Premier League this season.
"We are grateful for all of Damien's efforts on behalf of Liverpool and wish him all the best for the future," club owner John W Henry said in a statement.
Chairman Tom Werner added: "The club needs to move forward and we now have a huge game on Saturday. It is important that everyone joins us in supporting the manager and gets behind Kenny and the team and focuses on a strong finish to the season."
Comolli previously spent three years as director of football at Tottenham, before leaving the club to return to France in a similar post at Saint Etienne.
It is an interesting development ahead of the planned meeting between the owners and boss Kenny Dalglish to review the season so far. The pressure on Dalglish may lessen if they beat Everton in this weekend's FA Cup semi-final. The last gasp win over Blackburn in the league this week will at least mean the Reds go to Wembley on a high note.