The actress's final scenes as Cheryl will air in March in the same week as her on-screen brother Brendan's dramatic departure.
Cheryl's exit will be tied in with Brendan's, but show bosses are currently keeping tight-lipped about whether viewers can expect a death, an arrest or an escape from the village - with or without her sibling in tow.
Waugh told Digital Spy today (February 1): "Deciding to leave Hollyoaks was tough - I have had the most incredible four years on the show and the cast and crew really are like my family - but it just feels like the right time for me and for Cheryl.
"I am so proud to have had the opportunity to be a part of some of the most hard-hitting and heart-warming storylines. I would like to thank everyone at Lime Pictures, especially the crew, who are some of the most talented and creative individuals that I've ever had the pleasure to work with.
"I am indebted to the support that the Hollyoaks fans have given me, and to Cheryl and the Brady family."
Cheryl was first introduced to viewers in late-night spinoff Hollyoaks Later in 2008. She was then brought into the main show as a new regular in early 2009.
The fun-loving character's storylines have mixed both comedy and drama over the years, and viewers have seen tough times for her while dealing with the darkness surrounding her sibling Brendan.
Hollyoaks' executive producer Bryan Kirkwood added: "Bronagh has brought an irrepressible, unique and beautiful flavour to Hollyoaks for the last four years and the much loved character of Cheryl will be hugely missed by everyone here.
"From a guest role in Hollyoaks Later, Cheryl quickly made her mark on the main 6.30pm show and created one of Hollyoaks' greatest characters. We wish her the very best for the future."
Show insiders are promising that the final scenes for Brendan and Cheryl will be part of an "explosive" week of Hollyoaks, with a number of twists and turns leading up to their exits.
Away from Hollyoaks, Waugh is keen to explore new roles and opportunities both in Ireland and the UK.
In summer 2012, the 30-year-old filmed BBC thriller The Fall alongside Gillian Anderson, which gave her the taste to take on new parts.
Hollyoaks airs weeknights at 6.30pm on Channel 4, with first look screenings at 7pm on E4. Get the Inside Soap magazine on your iPhone or iPad