Hibs will not enter a team into next season's Reserve League, and will instead choose to organise their own games programme while looking to send their youngsters out on loan.
The Easter Road side is also planning to "push the squad out of any comfort zone" by scheduling matches against clubs from "Scotland, England and further afield when possible".
The Capital club played matches against Stirling Albion plus Under-23 sides from Huddersfield and Middlesbrough following the culmination of the 2018/19 Reserve League, and are keen to focus on matches against that level of opposition in a bid to maximise the development potential of the club's young players.
Head of Football Operations George Craig insisted it was not a decision that had been taken lightly, adding: "We are committed to playing our part in ensuring that youth development in Scotland is in the best possible condition it can be.
“However, first and foremost, our responsibility is to Hibernian and our supporters.
“We are passionate about the work done within the Hibernian Academy and are proud of our record in producing talented young professionals who have gone on to make a real impact in the Scottish game.
“If we wish to constantly improve standards across the board then it stands to reason that we have to constantly re-evaluate what we do, and there are some concerns about the Reserve League setup as it is."
Hibs head coach Paul Heckingbottom and assistant Robbie Stockdale both arrived in Edinburgh from developmental backgrounds and Craig revealed that both coaches would "attest to the fact they learned more about those involved in [the matches against Stirling Albion and the two English sides] than in some of the Reserve League fixtures".
Craig continued: "We want to keep providing our young players with games that will ask different questions of them and accelerate and enhance their development.
"That desire is what has led us to, regrettably, take a step away from the Reserve League for next season.
“Strategic loan moves will continue to play a big part in our development strategy and we have benefited from such arrangements in the recent past with Jamie Gullan at Raith Rovers and Josh Campbell at Airdrie.
“Ryan Porteous also had a very successful loan spell with Edinburgh City before breaking into our first team."
Hibs have sent details of all their development players to each club in the Scottish Championship, Scottish League One and Scottish League Two, with a view to arranging loan deals.
Craig continued: “The best-case scenario for us would be to see a number of the boys go out on loan to senior clubs, playing senior football at the weekends while also being able to take part in our midweek games programme against specifically-sourced opposition.
“Nothing is ever set in stone. We will continue to fine-tune and re-evaluate what we do but the goal remains the same.”
Hibs are the fourth club to withdraw from next term's Reserve League, joining Celtic, Rangers and St Johnstone in opting out of the competition.