The Defence Forces are to withdraw from the United Nations Disengagement Observer Force (UNDOF) on the Golan Heights on the Israeli-Syrian border.
Around 130 personnel from the Infantry Group are based there maintaining an area of separation that is over 75km long.
Tánaiste and Minister for Defence Micheál Martin has informed the Government of his decision to withdraw the Irish contribution.
The date of the move will be discussed with the United Nations Department of Peace Operations.
In a statement, the Department of Defence said the decision follows the conclusion of an assessment of the sustainability of the Defence Forces’ overseas commitments and is based on military advice.
It said the decision will ensure that the Defence Forces has the capacity to fulfil its commitment to the new European Union Battlegroup.
It will also allow the Defence Forces to undertake a process of consolidation with regard to their overseas commitments and to prepare for future peacekeeping missions.
The withdrawal of troops from UNDOF will also relieve ongoing challenges in filling certain specialist roles in overseas deployments, the statement added.
Mr Martin said the Defence Forces will engage with the United Nations with a view to maintaining some or all of the staff posts currently occupied by Irish personnel in UNDOF headquarters and will explore the possibility of providing a modest increase in our troop contribution to the United Nations Interim Force in Lebanon (UNIFIL).
Ireland began its participation in UNDOF on 22 June 2013 at the request of the UN.
The 66th Infantry Group is currently based in Camp Faouar on the Syrian side of the area of separation.
The members are due to return home next month and will be replaced by the 67th Infantry Group.