Christina Romer, chairwoman of the president's Council of Economic Advisers, announced Thursday that she would be leaving the administration.
Romer will resign on Sept. 3 and return to her position as an economic professor at the University of California at Berkeley.
Romer's son will be starting high school in the fall in California, the White House said in a statement.
“Christy Romer has provided extraordinary service to me and our country during a time of economic crisis and recovery,” President Obama said. “The challenges we faced demanded more of Christy than any of her predecessors, and I greatly valued and appreciated her skill, commitment and wise counsel."
In the same statement, Romer said it had been the "honor of a lifetime" to serve in the White House.
“While I look forward to returning to research and teaching, the opportunity to help shape economic policy these past 20 months, and to work with the other members of the economic team and my colleagues on the CEA, is one I will always cherish,” Romer said.
Romer was one of the more liberal members of the president's economic team.
As the administration was debating over how to boost an economy rocked by the Wall Street crisis soon after Obama's election, Romer prepared a paper calling for a $1.2 trillion stimulus, larger than the $787 billion measure that was enacted, according to a report by the The New Yorker. (The cost of the enacted stimulus has since been increased to $862 billion by the Congressional Budget Office.) Lawrence Summers, the director of the National Economic Council, refused to include the Romer's analysis when presenting Obama with his stimulus options, the report said.
When asked about the size of the stimulus package, White House officials, including Romer, have since argued that the bill was the largest they could push through Congress.
Romer's departure leaves Jared Bernstein, the top economic adviser to Vice President Biden and a former staffer at the union-backed Economic Policy Institute, as the most senior liberal economist in the Obama administration.
This post was updated at 9:55 p.m.