The actor – who joined the cast in 2013, playing Queen Vic landlord Mick Carter – is not leaving imminently, with “plenty of explosive drama” for his character before then.
A spokeswoman for the soap said Dyer, 44, has not been blocked from other projects and denied reports suggesting the BBC show is in a crisis ahead of his departure.
According to a friend, the decision was not taken “lightly” by Dyer, who feels the “time is right to explore other roles”.
EastEnders said: “Danny will be leaving EastEnders when his contract comes to an end later this year.
“Danny has made Mick Carter an iconic character, which we shall always be grateful for, however we won’t be saying goodbye just yet as there’s still quite some time – and plenty of explosive drama for Mick – to come before he departs Walford. ”
A friend of Dyer’s said: “Danny loves EastEnders but as an actor he feels the time is right to explore other roles.
“He’s incredibly grateful to the show and the opportunities it has given him, and it wasn’t a decision he took lightly, but after playing Mick for nearly nine years he feels it’s time to give the character of Mick a rest.
“He’s not sure how they are going to write him out yet but he’s hoping that they leave the door open for Mick.”
An EastEnders source said: “Danny made the decision quite some time ago that he would leave the show this year, which has given bosses plenty of time to plan a huge storyline for him.”
The source added Dyer’s character will be “at the heart of some big drama” with the return of Kellie Bright’s character Linda Carter this year.