Starting September, Cheil Worldwide and its US-owned agency The Barbarian Group, will cease to work with the United Arab Emirates airline on an account it won in 2015.
"Following significant structural changes at Etihad we will cease to work with Etihad as of mid-September this year," Peter Zillig, chief executive of Cheil London, said.
The move, he continued, is due to Etihad's decision to make more efficient use of its existing assets and in-house resources and is "in no way a reflection of the work that Cheil has done or the relationship that we have built."
Tim Burnell, vice-president marketing, Etihad Airways, said that the brand's marketing model is evolving and the decision to split with Cheil reflects that change along with a "desire to further utilise in-house resources".
This change does not affect Etihad's relationship with its global media and buying partner, Starcom.
Etihad does not currently have a retained creative agency having decided not to put the account to pitch after splitting with M&C Saatchi last year.