Ricky Stuart has walked out on Parramatta to take up a three-year contract to coach Canberra.
The 46-year-old told the Eels board of his decision on Wednesday evening having led the club to a second successive NRL wooden spoon with just just five wins all season.
The Eels have been plagued with boardroom dramas all season and the former NSW coach insisted on a get-out clause in his contract when he accepted the role at the start of this season.
"The period I have been at the Parramatta Eels has been extremely challenging,'' Stuart said in a statement released through his manager John Fordham.
"Not only for me but for people like (chairman) Steve Sharp who clearly have the club's best interest at heart.
"I sincerely hope the stability the club is entitled to will return and reward those people who have a genuine commitment and passion for the Eels.''
Eels co-captain Jarryd Hayne said he was surprised by the decision but had yet to be informed by the club.
The NSW star said the news rounded off a difficult season for him and the club.
"We always knew there were rumours but I haven't got confirmation yet and I haven't been told by club officials,'' Hayne said.
"It's obviously a huge shock but as I said I haven't had anything official, until then I will just have to wait and hear it from the horse's mouth.
"But it's definitely been the toughest year of my career. It's been tough. This news comes out it just makes it worse. We all knew there were rumours going around.
"We heard bits and pieces about it. We had a meeting with Sticky (Stuart) a couple of the senior players and for us we had an idea what was going on.
"Stick sat us down and gave us his side of things. It was one of those things.''
NSW coach and close friend Laurie Daley said he was delighted to see Stuart return to their old club and said he was the man to sort out the off-field issues that have blighted the playing squad this year.
"It's good. He is going back home,'' Daley said.
"I am really happy for him. The club has had some dramas this year and they need fixing and they will certainly add some discipline.
"It doesn't surprise me. He was always the man they wanted, whether he could have moved on was the issue. It's a match that everyone wanted to see, being a local boy.''