Officials say the Health and Human Services secretary made the decision to resign and wasn't forced out.
But Sebelius’ relationship with the White House frayed during the glitch-ridden rollout of the Obamacare insurance exchanges last fall, The Washington Post and other media report.
Sylvia Mathews Burwell, whom President Obama is expected to name on Friday to replace Sebelius, is the second woman after Alice Rivlin to be White House budget director.
Burwell has a reputation for strong organizational skills and navigating the bureaucracy and is said to be well-liked by many Republican lawmakers. She was confirmed unanimously by the Senate for her budget job.
Burwell has experience helping a president with a tough issue. She became deputy chief of staff for policy in the Clinton administration in the midst of the Monica Lewinsky scandal.
Her main job was to keep the White House focused on its agenda while Clinton fought off impeachment, says The New York Times.