Creative Scotland said Richard Findlay, who was appointed in January 2015, will leave his post as chair this week.
A temporary chair is expected to be put in place as soon as possible while the Scottish Government recruits a replacement.
Mr Findlay, a former chief executive of Scottish Radio Holdings and chair of STV, was the founding chairman of the National Theatre of Scotland when it was set up over a decade ago.
Mr Findlay, 73, also had a spell as chair of the Royal Lyceum Theatre in Edinburgh.
Mr Findlay replaced former Standard Life chief executive Sir Sandy Crombie as chair of Creative Scotland.
Sir Sandy had a turbulent tenure, facing a rebellion from artists over the way funding decisions were being made, concern over the body’s management style and anger about its use of “business-speak”.
Mr Findlay, who was awarded the CBE in 2013 for services to the arts and creative industries, is a graduate of the Royal Scottish Academy of Music and Drama, where he later served as a governor, and pursued acting as an early career.
A statement from Creative Scotland said: “It is with sadness and regret that we announce that our chair, Richard Findlay CBE, will be stepping down this week owing to ill-health.
“The Scottish Government is in the process of putting in place interim arrangements and will begin the process of recruiting a permanent chair as soon as possible.
“More information will be announced by them in due course.
“In the meantime business continues as usual under the governance of Creative Scotland’s board and senior team.”
When Mr Findlay was appointed, Creative Scotland’s chief executive Janet Archer praised him for "deep and rich experience of the arts, screen and creative industries in Scotland, as well as a lifelong involvement of culture in both a professional and personal capacity.”