Ousted Yahoo chief executive Scott Thompson told board members before his resignation that he has cancer, the Wall Street Journal reported today.
Thompson had quit amid a controversy over inaccurate academic credentials.
He said the diagnosis played a role in his decision to step down, but that he did not want to publicly disclose his thyroid cancer, the newspaper said.
He resigned amid a probe into why he had inaccurately stated he had a computer science degree.
The newspaper said Thompson, 54, reached an agreement to resign with some severance pay.
Thompson left a job as head of online payments firm PayPal, a key unit of Internet auction powerhouse eBay, to take the Yahoo helm.
Under Thompson, Yahoo dumped products along with workers in a quest to put the company back on course.
Yahoo said in April that it would slash some 2,000 jobs in a purge aimed at becoming a "smaller, nimbler, more profitable" company.
As part of a truce in a proxy war with mutinous shareholder Daniel Loeb, Ross Levinsohn became interim Yahoo chief and Fred Amoroso took charge of the board of directors.
The changes are part of a settlement with Loeb's hedge fund Third Point, which is waging a proxy battle at the Sunnyvale, California-based firm. Loeb and two of his picks - Harry Wilson and Michael Wolf - will take seats on the Yahoo board on Wednesday.
Five current board members, including director Roy Bostock and Patti Hart, will step down immediately and not end their terms at this year's annual shareholders meeting as originally planned, according to Yahoo.
"The board is pleased to announce these changes and the settlement with Third Point, and is confident that they will serve the best interests of our shareholders," Amoroso said in a statement.
Levinsohn's background includes running Fox Interactive Media when the News Corporation property bought then-flourishing social networking star MySpace for $580m and cut a lucrative search deal with Google. Levinsohn recently ran Yahoo advertising sales in the Americas.
The company last week began investigating a charge leveled by Loeb that Thompson misstated academic credentials by claiming on his CV a computer science degree that he never earned. Yahoo! acknowledged an "inadvertent error" in the CEO's online biography. Third Point, which owns 5.8% of the struggling tech giant, wanted Thompson fired.
Thompson was named Yahoo chief in January, four months after the company sacked his predecessor Carol Bartz over her unsuccessful efforts to turn the company around. Bartz was fired after less than three years in the job. She blasted her overseers as "the worst board in the country" after being pushed out the door.
Thompson left a job as head of online payments firm PayPal, a key unit of Internet auction powerhouse eBay, to take the Yahoo helm.
Yahoo has been trying to reinvent itself as a "premier digital media" company since the once-flowering Internet search service found itself withering in Google's shadow. Yahoo's share of overall US online ad revenue dropped from 15.7% in 2009 to just 9.5% last year, according to industry tracker eMarketer.
While the online advertising market is expected to grow 23.3% to $39.5 billion this year, Yahoo's share of revenues will fall further to 7.4%, eMarketer forecast.
As the company strived for a new identity, it saw an exodus of talent that commenced during a failed bid by technology giant Microsoft to buy Yahoo four years ago for about $45 billion.
