Nichol's decision was outlined in an e-mail to the university community on Tuesday after he was advised Sunday that his contract would not be renewed in July.
Nichol has come under fire from some alumni, students, politicians and community members who have criticized his decisions during his almost three years on the job.
During his tenure, Nichol removed the cross from permanent display in the school's chapel to make students and visitors of non-Christian faiths feel more welcome. The cross could be put back upon request.
Most recently, he was criticized for allowing an art show featuring sex workers to be held on the Williamsburg campus.