The move spells the end of a four-and-a-half-year partnership between the jeans manufacturer and the UK agency, which launched in 1998 with Lee's European account. The US business is handled by Fallon in Minneapolis.
Robert Senior, a partner at Fallon, said: "This is a grown-up business decision after a lot of soul searching on both sides. It's not something that either party does lightly, but it's the right decision for both our brands."
No-one at VF Northern Europe in Brussels was available to comment on which agencies would now be invited to pitch for the business.
Mediaedge:cia, which won the business as CIA Medianetwork in April 1998, continues to handle media activity for the brand.
Lee Jeans dropped Grey and appointed Fallon London to its £12 million European advertising account in April 1998. The agency won the business after a pitch against Abbott Mead Vickers BBDO, DFGW and Grey, which had been the incumbent on the account for six years.
Its most recent activity on the account was an eye-catching pan-European campaign that ran last year and featured talking bottoms going on a quest in search of the perfect pair of Lee Jeans. The Ringan Ledwidge-directed spot ran on cinema, MTV Europe and as a viral, and represented a repositioning of the brand, while aiming to steal market share from its primary rival, Levi Strauss.
Last year, Lee spent £3 million on advertising across eight European markets.
VF's retail remit covers jeans, casual clothes and luggage. The advertising activity for its Wrangler Jeans brand is handled by AMV.