Diffusion won a pitch for the account in December 2013, unseating incumbent Juicy Communications.
The brief was to create a series of campaigns aimed at changing the perception of the Cayman Islands as a financial services centre, promoting the islands as areas of natural beauty and a place for activities including diving and birdwatching.
The brief also covered other destinations including the Seychelles and Mauritius.
The role is being brought in-house and being carried out by Don McDougall, regional manager of the Cayman Islands Department of Tourism.
McDougall said: "While it was a productive relationship, the Cayman Islands Department of Tourism is tasked to always find economic efficiencies in all areas of the business. Therefore, at the completion of the contract the department opted not to renew in order to explore other options that would best enable the business to meet its cost-saving mandate and strategic business objectives."