The departure of the 65-year-old has dealt a significant blow for the team, with Newey helping design the cars that achieved seven drivers and six constructors' titles for Red Bull.
In addition to Newey, their sporting director Jonathan Wheatley will also be leaving the team where he will become team principal at Audi.
Sergio Perez without key Red Bull ally at Dutch GP
Now Red Bull are set to lose Sergio Perez’s race engineer Hugh Bird, who will be on temporary paternity leave from the Dutch GP onwards.
Perez will be joined by a new engineer at Zandvoort, with Bird’s replacement believed to be Richard Wood, who is currently a performance engineer at the team.
These changes come after a period of difficulty for the Mexican driver, where a series of poor performances placed his future in jeopardy.
The 34-year-old scored 24 points in the last six races, and as pressure mounted he suffered a series of dramatic crashes in Q1 at Silverstone and Hungary.
As his performances worsened, reports speculated that he may be replaced heading into the summer break.
However, Red Bull announced that Perez would be remaining with the team for the rest of the season, putting end to speculation that he could lose his seat.
The team are reportedly committed to helping Perez improve in the remaining the next 10 races of the season, where he is expected revert to the older-spec version of the RB20.