It follows reports that President Trump was outraged by comments made by Mulvaney during the Ukraine corruption saga.
The allegations of abuse of power over the Ukraine incident led to impeachment proceedings against President Trump.
Mulvaney's departure has been on the cards for the last few weeks.
Mr Mulvaney is to become US special envoy to Northern Ireland, while North Carolina lawmaker Mark Meadows has been appointed to take over his former position.
US launches strike against ISIS in northwest Nigeria
The United States has carried out a strike against IS targets in northwest Nigeria at the request of Nigeria's government, President Donald Trump and the US military said on Thursday, claiming the group had been targeting Christians in the region.
Ukraine president discusses "bringing peace closer" with US negotiators
Ukrainian President Volodymyr Zelenskyy said on Thursday that he spoke with US President Donald Trump's special envoy Steve Witkoff and son-in-law Jared Kushner for about an hour on how to end the war with Russia.
White House to present plans for Trump's East Wing ballroom in January
The White House will unveil new details on President Donald Trump's planned East Wing ballroom during a hearing early next month, according to a federal commission tasked with reviewing the project.
Arab Parliament welcomes direct municipal elections in Somalia
The Arab Parliament has welcomed the holding of direct municipal elections in Somalia, considered to be the first in the country since 1969.
Bangladesh leader considered PM frontrunner returns from exile
Bangladesh Nationalist Party acting Chairman Tarique Rahman returned from nearly 17 years in exile on Thursday, a homecoming the party hopes will energise supporters with Rahman poised to be the top contender for prime minister in February.
