The former Matildas boss and ex-Socceroos assistant led the Bulls for their first two seasons as an expansion club, including a semi-final appearance in their maiden campaign.
With two regular-season games left, seventh-placed Macarthur are still in the mix for the top six again this season.
"It has been a great honour to be the first-ever head coach of Macarthur FC," Milicic said.
"I was attracted to this role several years ago because of the exciting opportunity to help build the foundations of this great club in a region in south western Sydney that has a very exciting future.
"I will remain a great supporter of the Bulls forever. We are now determined to finish the season strongly.
"I leave with mixed emotions, but for family reasons I will be returning to Croatia."
In 50 ALM games, Milicic has coached the Bulls to 20 wins, 20 losses and 10 draws.
Macarthur chief executive Sam Krslovic hailed Milicic's influence.
"On behalf of the board of Macarthur FC I would like to thank Ante for his extraordinary work over the last two seasons," he said.
"He has introduced a world-class football environment at the Bulls that will serve us well into the future."
It is unclear what direction the Bulls will take for their next manager.
Assistant Ivan Jolic has stepped in for Milicic before, while they have previously been linked to now-Wanderers boss Mark Rudan and Wellington coach Ufuk Talay.
Elsewhere, Western Sydney and Olyroos midfielder Keanu Baccus will reportedly sign with Scottish Premiership club St Mirren.
The Daily Record reports Baccus has signed a two-year pre-contract deal to move this summer, after having interest from clubs in England and Scotland.
The 23-year-old has played 104 ALM games.
St Mirren, formerly the home of Socceroos midfielder Aaron Mooy, are locked in a relegation battle. They are currently five points clear of safety with four games left.
