Mike Pence's chief of staff Nick Ayers has reportedly been angling for the job and is seen as the leading candidate.
Trump, meanwwhile, announced Saturday that he's picked a battle-hardened commander who oversaw troops in Iraq and Afghanistan to be the nation's next top military adviser. Kelly took part in at least four Oval Office meetings with Trump on Thursday.
Trump did not immediately name Kelly's replacement but said he planned to "in the next day or so".
Describing his relationship with President Trump as "tumultuous", CNN's Kaitlan Collins on-air reports Kelly is "expected to reign in the coming days".
It also found that White House lawyers objected to the interview of Kelly at first, arguing that executive branch officials should be free from such obligations unless necessary.
Trump also said that State Department spokeswoman Heather Nauert was his pick to replace Nikki Haley as the next US ambassador to the United Nations. But President Donald Trump is apparently treating the retired Marine general like he's already gone.
Kelly's tenure working for Trump was pocked with controversies, and officials were often amazed at how he managed to survive.