Finance Department boss Jane Halton has announced her resignation.
The department's staff were told on Friday morning of her pending departure after 33 years as a public servant and 14 as a departmental secretary.
Deputy secretary Rosemary Huxtable will act in Ms Halton's position from October 15 until a permanent replacement is found.
Ms Halton has been one of Australia's highest-profile bureaucrats since she chaired the Howard government's "people smuggling taskforce" in 2001 and was at the centre of the children overboard affair.
Despite the bitterness the affair engendered on the left of politics, Ms Halton worked effectively with subsequent Labor governments, most notably as secretary of the Health Department and her role in delivering Labor's plain packaging for cigarettes.
Friday also saw the resignation of charismatic Clerk of the Senate Rosemary Laing after six years in the job and 26 years with the Department of the Senate.
The outspoken Dr Laing made headlines in 2015 when she intervened in the appointment process for a new Clerk of Britain's House of Commons, telling authorities there the appointment of Carol Mills, then boss of the Department of Parliamentary Services in Canberra, would be "bizarre", "embarrassing" and an "affront".
In her message to Finance Department staff, Ms Halton said she had decided the time was right to move on.
"I have decided that it is time to move aside and give someone else the opportunity to lead a Commonwealth department," Ms Halton wrote to staff.
"After nearly 15 years as a secretary, at the beginning of a term of government, having beaten my father's record of time as a secretary (a personal milestone), and now with our reform program in place it is the right time to go."
But it is unclear where the veteran secretary, who moved to Finance from Health in 2014, is heading.
Moments after Finance staff were told the news, Prime Minister Malcolm Turnbull announced her resignation.
"Ms Halton has made an enormous contribution in public life both nationally and internationally and has been a leader for women in the public sector," Mr Turnbull said.
Finance Minister Mathias Cormann joined the Prime Minister in paying tribute.
"My own interactions with Jane have straddled both periods of opposition and government," Senator Cormann said.
"At all times, I have very much appreciated Jane's professionalism, competence and good humour.
"Though it is fair to say that Senate estimates is more fun with Jane sitting next to you rather than on the other side of the table."
Labor's leader in the Senate Penny Wong praised Dr Laing's contribution to Australia's democracy.
"In her seven years in the post Dr Laing has never faltered in her advocacy of the role and powers of the Senate in our bicameral Parliament, nor in her defence of the independence of the Senate as a house of review," Senator Wong said.
"I personally appreciate the professional and impartial advice she has provided to me and Labor senators at all times."