Williams, which has put itself up for sale, is ending the deal with telecommunications firm ROKiT, which was founded by Jonathan Kendrick.
It comes after Williams posted a £13 million loss last year.
Williams announced that it had "terminated its sponsorship arrangements with ROKiT, effective immediately".
Mr Kendrick, born in Wolverhampton and based in Albrighton, said: “ROKiT would like to take this opportunity to wish Williams well with their plans for a potential sale of the Formula One team.
"As a group, ROKiT remains fully committed to its other existing motorsport partnerships and the exploration of additional strategic partnerships in the near future.”
ROKit, which has offices in Albrighton and the US, had agreed a deal to be the title partner of Williams Racing last year.
The team was known as ROKit Williams Racing, with the company's branding adorning the Mercedes race car, drivers' clothing and helmets and staff uniforms.
ROKit was founded by Mr Kendrick and US entrepreneur John Paul DeJoria, the man behind the Paul Mitchell range of hair care products and is part of the pair's ROK Stars group of companies which includes drinks, beauty products and water purification.
Mr Kendrick's close affiliation with Formula One and Williams started, aged 17, with Goodyear Racing in Wolverhampton, before securing the European rights of the then unknown Yokohama Tyres, ahead of moving into audio-visual innovation for mobile phones.
As part of the Williams trackside team, Mr Kendrick engineered the tyres of Alan Jones' race car at the 1978 Argentine Grand Prix in Buenos Aires.