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United finished fourth in the WSL for the second consecutive season, narrowly missing out on qualification for the Women’s Champions League by a single point.
Stoney was appointed as head coach of United in 2018 after the Old Trafford club reformed their women’s side and guided them to promotion from the second-tier Women’s Championship the following season.
The 38-year-old’s last game in charge will be Sunday’s FA Cup fifth round tie against Leicester City, United’s final match of the season.
Stoney said: “It has been an honour to lead the women’s team at this great club and this has been an incredibly tough decision.
“Having come on board to start the team from scratch, then winning the Women’s Championship in our first season, we have now successfully established the team as a force in the Women’s Super League.
“I have loved leading this group and I am proud of what we have achieved together. However, after a difficult season with disruption caused by the pandemic, I now feel the time is right to take some time away and for someone else to come in and lead the team on the next stage of its journey.
“I want to thank the club, all of the fantastic staff, the fans, and most of all the players, for the incredible experience we have shared over the past three years.”
United confirmed that they are in the process of recruiting a new head coach, with an announcement in due course.
Ed Woodward, United’s outgoing executive vice-chairman, paid tribute to Stoney as the “driving force” behind the success of the women’s side since it was reformed.
“As a club we are intensely proud of our women’s team and we have invested considerable resource to make it a success,” he said.
“Casey has been a driving force behind that success since she joined us in 2018. She has been an inspiration to her players and staff, fans, and to all of us.
“I know I speak for everyone in thanking her for her unstinting hard work and dedication and paying tribute to her achievements.”