Vandal, 53, will leave the government-owned utility May 1. No reason was given for his resignation, two years before the end of his contract.
In a news release, Premier Philippe Couillard and Natural Resources Minister Pierre Arcand said Hydro-Quebec benefited from his experience, including opening the Ontario and U.S. markets and ambitious projects like the La Romaine hydro-production complex.
He also oversaw the closure of Quebec's Gentilly-2 nuclear reactor.
In October, the provincial government appointed Montreal businessman Michael Penner as Hydro-Quebec's chairman, replacing Pierre Karl Peladeau, who left to enter politics.
Penner, who praised Vandal for making made a "remarkable contribution" to the development of Hydro-Quebec, said the board will decide in the coming weeks on a replacement process.
Vandal, an engineer, joined Hydro-Quebec in 1996, serving as vice-president strategic planning and later president of production. He came from the petroleum and natural gas sectors, having worked at Shell Canada, Kemtec Petroleum and later Gaz Metro.
He was appointed CEO in April 2005 by the Liberal government of Jean Charest. He was reappointed to a five-year term in 2012. His salary is $452,000 a year.
Vandal is a past chairman of the Conference Board of Canada and sits on the board of McGill University and the University of Montreal's HEC business school, from which he has an MBA and honorary doctorate.
In 2012, he was elected a Fellow of the Canadian Academy of Engineering and received the Canadian Energy Council's person of the year award.