His appointment last year was itself controversial. He was revealed to have been active on the party's left and had said he "absolutely" shares Mr Corbyn's views on Israel.
He was previously a member of the Labour Representation Committee, which has attacked allegations of antisemitism within the party as anti-Corbyn ""propaganda" from the "ruling class".
In the year since Mr Nardell was appointed, the row over Jew-hate has worsened, amid claims Jeremy Corbyn's staff have intervened in disciplinary cases to protect allies.
The party's failure to deal with the crisis is now the subject of a formal probe by equalities watchdog the ECHR, whch is investigating whether the party is institutionally antisemitic.
A Jewish Labour Movement spokesperson attacked the barrister's tenure.
They said: "Gordon Nardell’s tenure as General Counsel will be remarkable only for the absolute chaos and political manipulation within the Governance and Legal Unit that took place on his watch.
“The party leadership’s total failure to address anti-Jewish racism has led to the EHRC launching a statutory investigation into institutional racism following JLM’s referral. It is unsurprising that he has now resigned.
“The leadership must be held accountable for the culture of harassment, intimidation and casual racism that has gripped the Party, and follow Nardell’s example.”
Mr Nadell declined to comment. Labour said it did not comment on staffing matters.
