Napier will step down in Spring 2007 and move to Imperial Tobacco Group as non-executive chairman.
Napier will be retiring in the Spring of 2007 to take up the position of non-executive chairman of Imperial Tobacco Group, where he is already joint vice chairman.
Taylor Woodrow chairman Norman Askew said: "Over what will be five years since Iain joined as chief executive in February 2002, he has been responsible for steering Taylor Woodrow successfully through a period of significant change and considerable growth, establishing the group's position as one of the UK's leading homebuilders with a portfolio of successful homes businesses in the UK, North America and Spain."
Askew said that the Taylor Woodrow board had already started its search for a successor.
Napier was formerly chief executive of Bass Brewers and an executive director of Six Continents. He later joined the executive management committee of Interbrew SA.