First-year coach Brad Scott and chief executive Craig Vozzo have been focused on bringing stability to the Bombers since their respective appointments late last year.
But Mahoney's departure will leave a significant hole to be filled in the club's football department.
"This has been a difficult decision to come to but one that I am confident is the right for all involved," Mahoney said in a club statement on Friday.
"We are in year one of a new build under a new coach and in the position as (executive general manager of football) you need to be 100 per cent committed to the role to see the journey through.
"The past month I've been reflecting and have come to the realisation that I need a new challenge, and now is the right time to make that move."
Former Collingwood, Western Bulldogs and Port Adelaide player Mahoney joined Essendon at the end of 2020, following a longer stint as football boss at Melbourne.
The Bombers will now undertake a process to appoint his successor.
Essendon have been through plenty of change off the field over the last 12 months.
The club went through a tumultuous end to 2022, when it sacked Ben Rutten as coach and bungled the process to appoint a replacement for Xavier Campbell as chief executive.
Andrew Thorburn lasted just one day as CEO, plunging the Bombers into crisis when he stepped down due to his role as chairman of a church with divisive views around abortion and homosexuality.
Former West Coast football boss Vozzo was appointed Essendon CEO in December and has earned praise for his leadership.
Star defender Mason Redman last month said the Bombers' new direction under Vozzo and Scott had been crucial in his decision to sign a new five-year contract with the club.
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