Team principal Niki Lauda said: "Since taking over the reigns at Jaguar Racing, one thing has become very clear to me - we must focus 100 per cent of our efforts into Formula 1 if we are to reach our long-term target of winning races," said the Austrian former champion.
"The Formula 3 team has achieved an unsurpassed record of success in the last 13 years - not just in terms of race victories but also in developing young drivers - so this has been far from an easy decision, but it has been taken in the best interest of our Formula 1 programme."
Jaguar took over the Formula 3 team from Paul Stewart Racing two years ago, at the same time they took over the Formula 1 squad.
The team's new owners form a consortium comprising Van Diemen's John Uprichard, P1 Motorsport's Roly Vincini and Sweeney Racing's John Sweeney.
But Jaguar said that the future of its drivers, James Courtney and Andre Lotterer is still unclear. "Discussions with both men are on-going and again we want to ensure an outcome with their best interests in mind."
