In a statement released by the team on Monday, it was confirmed that Capito had stepped down as manager and CEO of the team, with FX technical director Demaison also stepping down.
Williams said he would announce his new team principal and technical director “in due course”.
“It has been a huge privilege to lead Williams Racing over the past two seasons and lay the foundation for the turnaround of this great team,” Capito said.
“I look forward to seeing the team continue its path to future success.”
Matthew Savage, chairman of Dorilton Capital, thanked Capito for his efforts at Williams as the team “embarked on a major transformation process to begin Williams Racing’s recovery journey”.
Since Capito took over, Williams has recovered from being adrift of midfield to score his first points for two years in Hungary last year, as well as a shock podium at the Belgian Grand Prix shortened by rain.
“We are grateful that Jost postponed his scheduled retirement to take on this challenge and now he will hand over the reins for the next part of this step-by-step process,” Savage said.
“We would also like to thank FX for their contribution and wish them all the best for their future as they move forward.”
Former Volkswagen Motorsport boss Capito took over at Williams at the end of 2020 following Dorilton Capital’s takeover of the team from the Williams family.
Capito enjoyed the height of his racing success as he oversaw VW’s motorsport division when it dominated the World Rally Championship before joining McLaren as CEO in F1.
But Capito left after just a few months on the job as part of a management shakeup following the arrival of Zak Brown and the departure of its longtime boss, Ron Dennis. He then returned to F1 with Williams to succeed Simon Roberts, who had served as interim team principal following the departure of Claire Williams in September 2020.
Capito is the second F1 team principal to step down since the end of the 2022 season in Abu Dhabi last month following the departure of Mattia Binotto from Ferrari.
Williams have fallen back to bottom in the Championship this year after dropping to ninth in 2021, but managed to pick up eight points over the season.
He signed Alex Albon to a long-term contract after arriving this year, having largely led his efforts throughout the season, as well as recruiting Formula 2 driver Logan Sargeant to replace Nicholas Latifi in 2023.