Rea's father Peter, who lives on Auckland's North Shore with his wife Carol, confirmed the split had been amicable.
Kyrgios' world ranking has gone from 843 to inside the top 100 with the help of Rea.
"They discussed this a month ago, and Nick said he was homesick and wanted to go to Canberra ... and Simon's not budging from his big-salary job in Melbourne," Mr Rea said.
The pair made a great team and had spent about 9 months travelling around the world for tennis commitments last year, Mr Rea said.
"Nick's a free spirit and a rising star and Simon's very orderly and conservative and totally disciplined but they get on very well."
The victory over Nadal had been a combined effort.
Mr Rea said his son had told him he had a specific game plan for the match.
"This time Nick followed it implicitly and he never really looked like losing," Mr Rea said.
When asked about the split, Kyrgios said he had not "actually had any thoughts on that at all".
"We have a commitment until the end of Wimbledon," he said.
"He's done a great job. I've had the best week of my life, the biggest win of my career."
Rea came on board the Kyrgios team in February last year - just after Kyrgios won the Australian Open boy's singles.
He's overseen the 19-year-old's rapid rise to the quarter-finals of a grand slam.
Kyrgios' official website said he "very quickly made a hugely positive impact" as the big-serving Kyrgios became the youngest ATP Challenger Title winner since Nadal.Tennis Australia has its other national centre in Canberra where Kyrgios' coach for seven years, Todd Larkham, is available.
Rea, 31 will return to duties with Tennis Australia where he coaches a squad of developing players.
In Auckland last night, Jonathan Rea said his brother was head boy at Auckland Grammar School in 2000 and was "incredibly intelligent and calm", which were great assets for a future coach.
"He is extremely passionate for tennis and sport and brings a hunger and work ethic for the sport, and he is thrilled to be involved in developing sporting talent," said Mr Rea.
A New Zealand national champion, Rea went to the University of Tennessee on a full scholarship from 2001 to 2004, joined the ATP international pro tour and represented New Zealand in the Davis Cup team, also playing in the Auckland Heineken tournaments.
