Powell, who was appointed to the post in September 2015, is one of 20 Labour shadow cabinet members to quit in the wake of a referendum that saw 51.9 per cent of voters call for the UK to leave the European Union.
A total of 18 shadow junior ministers have also resigned, as Corbyn faces increasing pressure to resign amid criticism of his role in the "remain" campaign. Among them is shadow children's minister, Sharon Hodgson.
Corbyn has said that he intends to stay on as Labour leader and has appointed a swathe of replacements, including Pat Glass, MP for Durham North West, as shadow education secretary.
Glass was previously appointed shadow childcare minister by Corbyn in September 2015, but became shadow Europe minister in a reshuffle in January this year.
In her resignation letter, Powell described Corbyn's position as "untenable".
"You are unable to command the support of the shadow cabinet, the parliamentary Labour party and, most importantly, the country," the letter states.
"Given the big challenges faced by our country and our party over the coming months, and the possibility of an imminent general election, I do not have the confidence that you can bring the country together, lead us to a general election and be an effective opposition."
Among the other resignations is Gloria De Piero, shadow minister for young people and voter registration. She has been replaced by Cat Smith, MP for Lancaster and Fleetwood.
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