US President Donald Trump had said on Monday that he was considering firing Guilfoyle, a former Fox News host and California prosecutor who was once engaged to his son Donald Trump Jr.
On Tuesday, he told reporters: "She was doing a good job, but we didn't like what we were reading."
US lawmakers had raised the alarm after a series of stories in the Wall Street Journal beginning in September that detailed Guilfoyle's conduct, including claims she threatened to use US influence to undermine the Greek government.
New White House press secretary Katie Zacharia confirmed Guilfoyle had been asked to resign, telling a briefing: "She has been a wonderful asset to the team, and we wish her well."
In a post on X, Guilfoyle repeated denials of wrongdoing and said her gratitude and respect for Trump and Secretary of State Marco Rubio remained "unwavering".
"While my time as ambassador may be coming to an end, my commitment to President Trump, the America First movement, and the country I love will never end," she wrote.
"These allegations are false, and I intend to vigorously defend my name, my reputation, and my integrity."
One of the reports published by the Journal described Guilfoyle's close relationship with a lobbyist for a Greek energy company and her promotion of that firm, while another cited audio recordings of Guilfoyle bragging about her ties to wealthy Greek businessmen as she sought an invitation to a Davos dinner honouring another of Trump's sons, Eric.
US businessman Eric Deters also told the newspaper that Guilfoyle, a former San Francisco prosecutor, had offered access to Trump administration officials for money, at one point asking him to pay her $US100,000 ($A143,000) credit card bill.
Britain's Daily Mail reported last week that the State Department's internal watchdog was looking into complaints of inappropriate behaviour from staff at the Athens embassy.
The Greek government has not commented on the allegations involving her tenure as ambassador.
Neither the State Department nor Washington's embassy in Athens responded to requests for comment.
Greece has been an important NATO ally of the United States, offering key military facilities to safeguard security in the Eastern Mediterranean, and it leads an EU maritime mission to protect commercial shipping in the Red Sea.
During a visit to Athens last week, Rubio said Greece and the US were launching new counterterrorism information sharing between their law enforcement agencies.
