The two organisations, which are both charities, were established in 2009 after the 2008 Gambling Commission review. The GREaT Foundation was set up to raise funds through voluntary donations from the gambling industry, which it passed to the RGF to distribute for research, education and treatment services independent of the gambling industry. GREat raised £5m in 2010/11.
A statement from the RGF said the funding arrangement was unworkable and had resulted in the RGF being unable to "operate with the degree of independence consistent with their governance documents and their duties under charity law".
"RGF has given notice that it is terminating the funding agreement with GREaT," it said.
A source close to the RGF claimed the gambling industry was more interested in funding treatment for problem gambling than research into the causes and effects of gambling.
Because RGF receives all its funding from the GREaT Foundation, said the source, it was unlikely that the charity would continue operating after March 2012, when the funding arrangement will end.
In response, GREaT said it welcomed "the end of what had become an unworkable distribution process for the funds raised by the industry".
Neil Goulden, chair of GREaT, said in a statement: "The gambling industry remains firmly committed to supporting and helping the very small minority of people who run into problems with their gambling.
"However, GREaT has become increasingly disillusioned at a structure which has proven to be costly and ineffective," he said.
"GREaT will now work to put in place a new distribution structure which is integrated and focuses on getting the maximum part of the £5m to those who need help. In so doing, we intend to work very closely with respected providers such as Gamcare."