Jo Kelly, of The Glebe Primary, in Southwick, announced her decision in a letter to parents on Monday (April 30).
Miss Kelly, who has been part of the Glebe for four years, told parents: "After 15 years in education, I do not feel I can carry on in our broken system.
"I came into this profession to give children the best life chances possible and I do not feel that I am able to do this any longer.
"The high stakes accountability system in place across the country means that we, as a profession, are taking the excitement and creativity out of teaching and learning.
"At Glebe, the fantastic staff team do everything in their power to give our children the best experience possible but even over the four years that I have been here, the pressure has increased and we are putting more and more pressure on staff and children to reach more and more difficult goals.
"I think this is unacceptable and don’t wish to see our children go through this anymore.
"The pressures from testing, the changes to the curriculum, league tables, Ofsted and the government have made it impossibly stressful.
"This is now coupled with a lack of funding to give children the very best start that they deserve – we are having to do more with less.
"Over the next few years, there will be some very difficult decisions to be made about staffing and this will again have a negative impact on our children."
West Sussex has long been one of the lowest funded local authorities in the country for education.
While the government's new National Funding Formula, which came into effect in April, saw £1.3bn put into education – with £28m coming to West Sussex over the next two years – headteachers have constantly warned that rising costs would see schools worse off.
For primary schools, one of the main concerns has involved the reduction of the £150k lump sum, which represented the minimum fixed costs of running a school.
Under the new formula, that sum will be reduced over the next couple of years to £110k.
It was a cut headteacher James Field, of St Robert Southwell Catholic Primary School, in Horsham, described as "crippling". Mr Field warned that the loss of that £40k could see some small schools "die out".
More than 500 people took to the streets of Worthing on April 21 to appeal to the government for better funding for West Sussex schools.
The march was organised by the campaign group SOS West Sussex. Campaigner and local mum Mel Pickett said: “Hundreds of families from across West Sussex have come down to send a loud and clear message. There is a funding crisis taking hold in our schools right here, right now, and we are calling on the Government to adequately fund schools and give our children the education they deserve.”
Shane Hales, chairman of governors at Glebe, said Miss Kelly's last day would be August 31.
He said the governing body had already met to discuss recruiting her replacement and hoped she or he would take up their post in january 2019.
An interim headteacher, supported through the local authority, will be put in place from September.
Mr Hales added: "Everyone will have the opportunity to say goodbye and thank you to Miss Kelly at the end of the summer term. In the meantime, on behalf of the Governing Body, I would like to thank Jo for her excellent contribution to Glebe Primary School and extend our very best wishes for her in the future."
Miss Kelly added: "The thing that makes me most proud of my work in education has been seeing a generation of children develop and turn into fantastic young people.
"It is with great pride that I come to school every day and work with the unique Glebies and I am so sad that I am giving up the career that I loved and have worked so hard for.
"However, I do not think the education system is fit for purpose.
"My role seems to be less about giving children rich and diverse experience and more about making sure they tick all the boxes required for a narrow testing and assessment system."
MPs meet education secretary
Tim Loughton and five other West Sussex MPs met Damian Hinds, Secretary of State for Education, to discuss funding concerns in the county’s schools.
While describing the money West Sussex will receive under the National Funding Formula as ‘considerable’, the MPs spoke to Mr Hinds about ‘the increase in costs borne by schools’.
They also raised concerns about high needs funding and how schools could be helped to improve standards, especially at primary level.
In a statement, the MPs said: “The new formula is of net benefit to West Sussex schools. However we made clear to the Education Secretary that the debate on school funding is not over.
"There is more that can be done locally over the next two years to relieve pressure on schools and we will be supporting West Sussex County Council and individual schools in doing so. It is also vital that the Education Department has the resources it needs.
"Since the 1990s, spending per pupil has nearly doubled in real terms and our spending levels compare well to most EU countries – spending more than either Germany or France. However we also expect more from our pupils and teaching staff than ever before.
"We will continue to campaign to ensure that the Autumn Budget allocates the right resources to support education.”