Ford is to stop manufacturing in India, and take a hit of about $2 billion.
The carmaker says it does not see a path to profitability in the country.
That makes Ford the latest automaker to leave a major growth market dominated by Asian rivals.
It entered India 25 years ago, but has a less than 2% share of the passenger vehicles market.
And has struggled to turn a profit.
In a statement, Ford said it accumulated operating losses of more than $2 billion over 10 years in India.
It follows other U.S. brands such as General Motors and Harley Davidson which have already left India.
The country is dominated by mainly low-cost cars made by Suzuki and Hyundai.
The U.S. automaker will continue to sell some of its cars in India through imports.
It said it will also provide support to dealers to service existing customers.
Around 4,000 employees are expected to be affected by the decision.