Sutley will step down in February from her post as chair of the White House Council on Environmental Quality, which she has held since 2009.
Obama thanked Sutley for playing a key role in the administration's "biggest environmental accomplishments" in a statement on Tuesday.
Sutley helped establish "historic new fuel economy standards that will save consumers money, new national monuments that permanently protect sites unique to our country’s rich history and natural heritage, our first comprehensive National Ocean Policy, and our Climate Action Plan that will help leave our children a safer, healthier planet," Obama said in a statement.
"Her efforts have made it clear that a healthy environment and a strong economy aren’t mutually exclusive – they can go hand in hand," he added.
The Natural Resources Defense Council praised Sutley on her leadership, calling her work on the administration's ocean policy "an important legacy for President Obama."
The White House has not named a replacement.
Sutley is the latest in a string of environmental officials to leave the administration. Early last month, Obama's climate and energy aide, Heather Zichal, left her post.
The Interior and Energy Departments have experienced a reshuffle of its upper brass since Obama began his second term.