Morell was passed over for the top CIA spot by President Barack Obama in favor of his counterterrorism adviser, John Brennan, who announced Morrell's departure Wednesday.
Brennan said he Morell will be replaced by Avril Haines, currently a deputy assistant to the president and legal adviser at the National Security Council.
Morell agreed to the State Department's request to remove a reference to militants in a controversial memo of talking points on the Libya attack.
Morell also drew criticism for stating that the CIA's interrogation program produced some useful information.
