There were doubts whether Williams would continue in the aftermath of Sam Allardyce being sacked as manager by the owners in December.
And, although he decided to stay in an executive chairman role he took up in 2005, Williams has now left citing "this is a new dawn for the club".
Managing director Tom Finn added: "All of us here at Ewood Park, our owners and I am sure all our fans, would like to take this opportunity to thank John for the contribution he has made during his tenure and we send him our best wishes for the future."
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