Morgan McSweeney will move to a "strategic role" with less of a focus on day-to-day activities, a Labour source said, after the dismal result in the Chesham and Amersham by-election.
Following the loss of the former stronghold seat of Hartlepool, concerns were growing over Labour's prospects in the July 1 by-election in Batley and Spen, which was Jo Cox's seat.
A new poll put the murdered MP's sister, Kim Leadbeater, on course to lose the heartlands constituency in Yorkshire to the Conservatives.
The Tories were on 47% - up 11% from the 2019 general election - while Labour was on 43%, according to Survation's phone poll of adults earlier this month.
The change of role for Mr McSweeney, who helped Sir Keir on his successful campaign to replace Jeremy Corbyn as Labour leader, came after the party ended up fourth in Chesham and Amersham on Thursday.
Labour secured just 622 votes in the by-election, taking just 1.6% of the vote and losing its deposit in the process.
Polling expert Sir John Curtice said it was the "worst Labour performance in any by-election.”
A Labour source: "Morgan remains Keir's number one adviser. He is staying on, staying in the top team and staying in LOTO (the Leader of the Opposition's Office) focusing on getting Labour election-ready for 2023."
Communications director Ben Nunn announced he was standing down from the role following Thursday's performance, but told colleagues he remained convinced Sir Keir "will be a great prime minister".
Scrutiny of Sir Keir's leadership will intensify if he loses Batley and Spen, having overseen the crushing defeat to the Tories in the former heartland town of Hartlepool last month.
The by-election was triggered after Tracy Brabin, who won the seat for Labour in 2019 with a 3,525 majority over the Conservatives, was elected as the mayor of West Yorkshire in May.