The unofficial reason for the resignation is that it's part of a growing row over the multi billion pound shortfall in the public funding for the Tube's upgrade.
Ken Livingstone was quick to show how this is a blow for Boris Johnson, who would have been relying on Tim O'Toole's experience and skills to ensure that as much of the upgrade as possible survived.
Livingstone said "I find it the most unbelievable incompetence and lack of interest in the lives of Londoners for Boris Johnson to lose one of the best public servants London has seen.
I want to thank Tim for his service to our great city. His unique personal qualities and professional talent, which won the hearts of all who worked with him, will be sorely missed."
Peter Hendy, London's Commissioner of Transport echoed Ken when he said O'Toole would be missed and said:
"Tim has led LU to its highest levels of performance while carrying record numbers of passengers - all at a time of great change as billions are invested to improve the Tube. His leadership was exemplified by getting London moving again so quickly after the terrorist attacks of July 2005. We will greatly miss him as a colleague and I will miss him as a friend".