By Lisa Beilfuss 

Target Corp. said Thursday that its veteran chief merchandising and supply-chain officer, who had clashed recently with former CEO Gregg Steinhafel, will leave both roles effective July 6.

Kathryn Tesija has agreed to remain at the retailer until April 2016 to assist with the transition, Target said. Ms. Tesija will continue to receive her current base salary and target bonus opportunity through that period, and she will be eligible for severance payments at the conclusion of her employment, according to the company.

Ms. Tesija joined Target in 1986 as a merchandise analyst and was promoted to chief merchandising officer in 2008. In 2012, the executive took on the additional role of supply-chain head. She had been viewed by some as a strong candidate to one day become the company's CEO.

The Wall Street Journal had reported in May of 2014 that Ms. Tesija hadn't been on speaking terms with Mr. Steinhafel since November 2013 and had approached the board to talk about the company's problems, according to people familiar with the matter.

Last summer, the Minneapolis company tapped PespiCo Inc. executive Brian Cornell as its new chief executive. Mr. Cornell, who in March announced job and cost cuts, has sought to bring Target back to its cheap-chic roots after the company became overly focused on prices and lost its fashion focus.

In a statement, Mr. Cornell said that "Over the past several months, Kathee and I have had many discussions about the business and together have decided that it is the right time for her to transition to an advisory role." Mr. Cornell added that Ms. Tesija "has been instrumental in Target's growth and our recent efforts to regain our momentum."

Write to Lisa Beilfuss at lisa.beilfuss@wsj.com

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