The 66-year-old showed his willingness to step aside, amid rumors surrounding his health and family reasons, after his former national team captain and central defender Fabio Cannavaro was appointed executive coach in November last year.
Lippi stepped down as technical director as Cannavaro, 41, adapted to his new role and when the news was formally announced on Thursday the transition from Lippi to the former FIFA World Player of the Year was complete.
The club thanked Lippi for his efforts over the past three years and has proposed to the Guangzhou city government that he be made an honorary citizen.