It is understood he will receive financial compensation.
Lace was suspended in March while Lowe launched an investigation into allegations that he had dealings with Sir Frank Lowe.
In a statement, IPG said: "Following a period of suspension, Garry Lace has resigned from the company with immediate effect."
Chris Hunton, the Lowe London managing director, and Judy Mitchem, its chief marketing officer, will run the agency while the search for Lace's successor takes place.
Lace refused to comment.