Strachan's side finished second behind Glasgow rivals Rangers for the first time in four years following Sunday's 0-0 draw with Hearts at Parkhead.
Strachan, who won three titles and three domestic cups in his four years in charge, is reported to be considering a move to Sunderland.
Celtic confirmed Strachan's departure on their website and Strachan said: "I have enjoyed my time immensely at Celtic and clearly I will be sad to leave this great club."
Celtic chief executive Lawwell paid tribute to the former Southampton and Coventry boss's achievements at Parkhead.
"Gordon has given everything to the club and worked tirelessly to bring success to Celtic," Lawwell said. "It has been a pleasure to work closely with Gordon and he leaves the club with all our best wishes." -- AFP
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