Intel, which originally agreed to contribute money and technical expertise to the OLPC programme, will continue with its own inexpensive laptop design called the Classmate, which it is marketing in some of the same emerging markets OLPC has targeted.
Both sides shared the objective of providing children around the world with the use of new technology, "but OLPC had asked Intel to end our support for non-OLPC platforms, including the Classmate PC, and to focus on the OLPC platform exclusively," Mulloy said.
"At the end of the day, we decided we couldn't accommodate that request."
A spokesman for OLPC did not immediately return a request for comment.
The OLPC programme was founded in 2005 by Nicholas Negroponte, former Media Lab director at the Massachusetts Institute of Technology.
The original concept was to offer a "$100 laptop," but the green-and-white low-power "XO" computer now costs $188.
It runs on a Linux operating system and a chip made by Advanced Micro Devices (AMD), an Intel rival.
Last year, Negroponte said until OLPC had a machine using an Intel chip, he could understand why Intel would not want to push an AMD machine to customers.
Mulloy said the use of AMD chips in the OLPC machines had nothing to do with Intel's decision to withdraw.
Intel believed all along that there is a need for multiple alternatives to meet the needs of children in poor countries, he said.
"It's unfortunate this happened, but at some point, you have to make a tough decision," he said.