Making the announcement in his Lok Sabha constituency, Anwar said he was resigning from all posts in the party, of which he was a founding member, and also giving up his membership of Parliament.
Anwar told reporters he was "hurt" by Pawar's interview to a Marathi news channel this week where he said Prime Minister Narendra Modi's intentions on the Rafale fighter jet aircraft deal were not wrong.
The party later came out with a clarification, saying it did not amount to a clean chit to the prime minister.
Anwar, a former union minister, has been backing the Congress demand for a JPC probe into the deal and has also sought a white paper on the issue.
"No decision has been taken so far about my future political move. I will be deciding that after consulting my supporters," he said.
Reacting to the development, Congress MLC Prem Chand Mishra described Anwar as a "fine leader".
"We shall be eagerly looking at his next political move," he said.
In New Delhi, senior party leader and Rajya Sabha MP D P Tripathi confirmed the development.
A former president of Congress' Bihar unit, Anwar formed the NCP in the 1990s along with Pawar and the late P A Sangma, opposing Sonia Gandhi taking over as AICC president on grounds of her foreign origin.
The party thereafter allied with the Congress at the national level and also in Maharashtra.