The puppeteer and voice of Elmo has denied all allegations and the Sesame Workshop released a statement today (November 20) expressing sadness at his departure.
"Sesame Workshop's mission is to harness the educational power of media to help all children the world over reach their highest potential," the statement read.
"Kevin Clash has helped us achieve that mission for 28 years, and none of us, especially Kevin, want anything to divert our attention from our focus on serving as a leading educational organisation."
They added: "Unfortunately, the controversy surrounding Kevin's personal life has become a distraction that none of us want, and he has concluded that he can no longer be effective in his job and has resigned from Sesame Street. This is a sad day for Sesame Street."
Clash had temporarily left the show following the recent allegations, which were later recanted by the accuser.
A new claim emerged today, when TMZ revealed that a man named Cecil Singleton was suing Clash in federal court for over $5 million.
Singleton claims that the pair met on a gay telephone chatline in 1993 when he was 15 and Clash was 17 years older than him.
Court documents reportedly date the alleged abuse as taking place between 1993 and 2003.