Shi, 48, has held the position for the past 10 years. However, with Wolves winless and rock bottom of the Premier League, he has stepped down.
Shi will remain chief exec of Wolves owners, Fosun, but will not hold any operational role. He is being replaced - in a caretaker capacity - by Nathan Shi (no relation).
Jeff Shi said: "I took the keys to this chair with humility. Today, I step aside with a heart full of gratitude. It has been an honour and a privilege to work alongside our leadership team, players, coaches, staff and – above all – our fans.
"Together, we have transformed the club into a global force, battling at the highest level.
"I would like to thank Fosun and the board for their trust, and every supporter for making Molineux shine. My seat may change, but my heart will still roar for this club every single game. I give my full support to the new management team and wish them every success in driving Wolves to even greater heights."
Nathan Shi said: "At this important and challenging moment, I look forward to working closely with all stakeholders to build a stronger future and to help Wolves reach new heights. I believe that together, as one pack, we will move forward with belief, pride, ambition and unity."