The official disclosed the decision Monday on the condition of anonymity because a public announcement has not been made.
Duncan, a former head of Chicago public schools, was widely expected to stick around. He is a former college basketball player who often joins Obama on the court.
During his first term, Duncan put in place the Race to the Top program that encouraged schools to compete for education dollars. Duncan's department also gave most states exemptions to the No Child Left Behind law when it became clear that they would not be able to meet the requirement that all students be proficient at grade level in math and reading by 2014.