Muilenburg will continue as CEO while lead director David Calhoun has been named chairman.
The move comes as Boeing continues to struggle to return its 737 Max model to service following two fatal crashes tied to its flight control systems.
Splitting the CEO and chairman roles "will enable Muilenburg to focus full time on running the company as it works to return the 737 MAX safely to service, ensure full support to Boeing's customers around the world, and implement changes to sharpen Boeing's focus on product and services safety," the company said in a statement.
The board also plans to name a new director with deep safety experience and expertise to serve on the board and a newly established aerospace safety committee, the company said.
"I am fully supportive of the board's action. Our entire team is laser-focused on returning the 737 MAX safely to service" Muilenburg said in the statement.
Boeing shares fell 61 cents, or 0.16% to $374.31 in after-hours trading Friday. The stock rose 1% in the regular session.
Boeing's 737 Max model was grounded worldwide in March after the second of two-fatal crashes tied to the control systems of the aircraft.