The assistant Bishop of Llandaff is resigning after speaking of a sustained campaign forcing him to quit.
David Wilbourne, a strong supporter of gay cleric Jeffrey John, will step down on Easter Sunday after 'considerable and increasing pressure to relinquish' his post for the past 18 months, he told the Church Times.
The Church in Wales denies there is any campaign against Bishop Wilbourne forcing him to quit and said his role had been there to assist the recently retired Archbishop of Wales, Barry Morgan, who was also Bishop of Llandaff.
The assistant bishop has backed Dr John, currently Dean of St Albans Cathedral, in a feud with bishops after he was recently blocked from being appointed Bishop of Llandaff.
Dr John wrote to the senior bishop in Wales, Dr John Davies, saying the only reason he was barred from the post was his sexuality.
'Ever since I knew that Jeffrey was in the frame for Llandaff, I thought it would speak mountains about our policy of inclusion. Wales has led on that; so I can't understand why the bishops aren't of the same mind,' he told the Church Times.
Dr John won more than half the votes in the electoral body appointing a new Bishop of Llandaff and unanimous support from local churchgoers on the panel. But he failed to win the two thirds necessary to be appointed and claims he was blocked by bishops after homophobic comments were made about him during the process.
The Church in Wales strongly denied allegations of homophobia during the election process and denies he was blocked.
In an official statement announcing his resignation, Bishop Wilbourne made no mention of the campaign against him.
'I realise it is time to hand over the baton to the newly appointed Bishop of Llandaff, so he or she can run free, enabling the Church which I have cherished these past years to flourish.
'I therefore intend to finish my time as assistant bishop on Easter Day 2017, just before the Sacred Synod approves our new bishop.
'I do so with the greatest gratitude for all the faithful parish priests and people here, whose marvellous ministry I am daily humbled by.
'I pray that you are given the bishop you so richly deserve, one who, in the words of Cardinal Basil Hume, simply comes to where people are and takes them to places they never dreamt of going.'
The Church's senior bishop, the Rt Revd John Davies, Bishop of Swansea and Brecon, who has current oversight of the Diocese of Llandaff, thanked Wilbourne for his work in the Church in Wales.
He said, 'Bishop David makes it clear in his own statement why he has made the decision to step down, and it is important that we respect that decision and the prayerful manner in which he has reached it.'
It comes after the Chapter of Southwark Cathedral became the latest to back Dr John in the increasingly bitter row, a statement on Thursday read.
'Southwark Cathedral has a long and proud reputation of standing up for diversity and inclusion within the church. It was therefore with deep sadness that we read the reports of the failed appointment process for the vacant see of the Diocese of Llandaff and especially of the way in which it affected the Dean of St Albans, the Very Revd Dr Jeffrey John.'
In a strongly worded statement the Chapter called 'for a future in which discrimination on the grounds of sexuality, gender or ethnicity will cease'. The statement described Dr John as 'a person of deep wisdom, the highest integrity and startling honesty.
'His willingness to live within the requirements laid down by the House of Bishops of the Church of England, and the public assurances that he does so, has not stopped him being rejected as a candidate for episcopal ministry.
We believe that the church, through its lack of similar integrity, wisdom and honesty, is failing to recognise the God-given abilities from which we as a community benefited.'