Mark James said it was “time to hand over the reins” at Carmarthenshire County Council when he turns 60.
Council leader Emlyn Dole praised him as a “great leader and ambassador” for the county.
Mr James made headlines in 2011 when he won a libel suit against blogger Jacqui Thompson, but the council was criticised for paying his legal fees.
Later, in 2014, he was at the centre of a Wales Audit Office row over cash paid to him by the council in lieu of pension contributions, but a police investigation found no evidence of crime.
Mr James joined Carmarthenshire County Council in 2002 after six years as chief executive of Boston Borough Council in Lincolnshire.
He said he had been “delighted” to have been involved in “exciting regeneration” projects such as Parc y Scarlets in Llanelli, Burry Port Harbour and Carmarthen town centre.
Mr Dole praised the outgoing chief executive for his “tireless dedication” to the county, saying: “We owe him a huge thanks and gratitude for all he has done over the past 17 years.”
Mr James, honoured with a CBE in 2012, applied for severance following the pension row, but later agreed to stay in post.