His departure draws to a close a difficult tenure as editor marked by falling circulation despite efforts to reinvigorate the title, including a redesign in March last year.
Bauer Media, publisher of FHM, said Kennedy resigned to pursue consulting opportunities. He left the company this week.
Media Week revealed in December last year that Bauer Media had called upon veteran FHM editor Ed Needham to redesign its flagship men's title – despite Kennedy still being editor.
During his time at FHM, Kennedy relaunched FHM.com, and made a number of changes to the printed product, including a revamp of brand offshoot FHM Bionic. He was the sixth editor of the title and replaced Anthony Noguera in May 2009.
Kennedy began his career at Smash Hits in 1996. He has also edited Bauer Media's sister title Empire.
Ben Wilson, features editor of the magazine, is thought to be a candidate to replace Kennedy.
Needham is overseeing the magazine until a replacement is found.
The title has felt the brunt of the decline in interest in monthly lad's magazines over the past few years. Its circulation fell 18.1% year on year to 192,586, according to the latest ABC results for the six months to June 2010.